Royal Society of Chemistry Financial Statements and Trustees’ Report 2015

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Contents

We are the world’s Welcome from the President 1 leading chemistry Objectives and strategy 2 community and our mission is to advance Achievements and performance 3 excellence in the Plans for the future 14 chemical sciences. Benevolent Fund 15 Financial review 17 Structure, governance and management 21 Subsidiary companies 23 Reference and administrative details 24 Auditors, bankers and other professional advisers 24 Royal Society of Chemistry Council 25 Responsibilities of the Trustees 26 Independent auditors’ report 27 Consolidated statement of financial activities for year ended 31 December 2015 28 Consolidated balance sheet as at 31 December 2015 29 Royal Society of Chemistry balance sheet as at 31 December 2015 30 Consolidated and charity statement of cash flows for year ended 31 December 2015 31 Notes to the financial statements 32

Welcome from the President

I’ve been a member of the Royal Society of Chemistry since Of course, science is international and to solve global I was an undergraduate at the University of Southampton. challenges we need to work together across borders. I’m immensely proud of our organisation and of being a It has been an honour to travel the world during my chemist. presidency, from the United States to Brazil and India, to strengthen links with other centres of chemistry. Last year The chemical and pharmaceutical industry alone is the UK’s we signed a partnership with the British Council, which will largest manufacturing exporter, with exports of nearly £50 help us bring UK chemists together with colleagues through billion each year*. a series of major international Newton Fund Researcher Chemists help make the medicines that save our lives, the Links workshops. fabrics for the clothes we wear, and the materials in our Finally, one of my priorities as President has been to smartphones. And without the chemical sciences, we won’t support innovation by bringing academia and industry be able to overcome the big challenges facing our world, closer together. So I am particularly pleased that from antimicrobial resistance to climate change. EnterprisePlus, our network to support small and medium- That’s why we work to advance excellence in our field. sized companies in the chemical sciences, reached 280 As my presidency draws to a close, I’m pleased to reflect on members last year. a year in which we did more to fulfil this mission than ever None of this would have been possible without our before. members. In 2015, our membership grew to over 54,000 In 2015, we became the biggest publisher of quality and our members continued to play a leading role in chemical sciences research in the world, sharing cutting our organisation, from chairing our leading scientific edge knowledge through nearly 44,000 journal articles. conferences, to serving on our publishing boards, to writing to their MPs in support of our campaigns. We nearly doubled our network of education coordinators, allowing us to inspire and support many more teachers and It has been a great honour to serve as President and to lead learners of chemistry around the country. the Royal Society of Chemistry into its 175th anniversary year. We continued to make our field more inclusive and diverse, delivering the first year of Chemistry for All, an innovative As I prepare to step down, I know that our community will project to understand how we can encourage children continue to go from strength to strength. Not just because from a broader range of backgrounds to study the subject I have every confidence in my successor, Sir John Holman, at university. but because of the dedication and expertise of our diverse and engaged staff and membership. We conducted the first ever study of public attitudes to chemistry in the UK, helping us understand how to better Indeed, I look forward to remaining an active member connect people in the wider community with the chemical myself, and to working together with our community to sciences. achieve even greater things in the future. And we successfully campaigned, with organisations across the sector, for the Government to ring-fence the science budget in the Comprehensive Spending Review, so that the UK can continue to be one of the best places in the world to do science. * According to the Chemical Industries Association’s “UK Chemical and Pharmaceutical Industry Facts and Figures”, 1 January 2015

1 Objectives and strategy

Our mission Our Royal Charter objectives We are the world’s leading chemistry community and Our Royal Charter sets out our objectives very clearly: our mission is to advance excellence in the chemical • to foster and encourage the growth and application sciences, for the benefit of science and humanity. of the chemical sciences by the dissemination of This has been the case ever since 1841 when 77 chemical knowledge. academics, doctors, industrialists and entrepreneurs • to establish, uphold and advance the standards of created our earliest incarnation, the Chemical Society qualification, competence and conduct of those who of London, with dialysis inventor Thomas Graham as practise chemistry as a profession. President. • to serve the public interest by acting in an advisory, In 2016, as we celebrate our 175th anniversary year, our consultative or representative capacity in matters mission is just as relevant, but we pursue it on a scale our relating to the science and practice of chemistry. founders would find inconceivable. • to advance the aims and objectives of members of the We now have over 54,000 members in 125 countries, Royal Society of Chemistry so far as they relate to the an internationally-renowned knowledge business, and advancement of the science or practice of chemistry. a reputation as an influential champion for the chemical sciences. Our 2013 to 2017 strategy Our global community spans hundreds of thousands of We strive to deliver our charter objectives in the most scientists, librarians, teachers, students, pupils and people relevant and effective way possible, and to make efficient who love chemistry. use of our resources so that we are sustainable for the long-term and to ensure we bring public benefit in accordance with guidance from the Charity Commission. To that end, we periodically revise our strategy. We are currently delivering our 2013 to 2017 strategy. This strategy is designed to maximise our core strengths and to ensure we are well-equipped to adapt and grow, as we have done for over 175 years. It is focused on five strategic strengths and priorities, as set out in the table below.

Our strength Our strategic objective

Our long history as a publisher, which means we have a strong Make the best chemical science knowledge Knowledge reputation as a global provider of high-quality chemical knowledge. available to all those who need it.

Our role as a professional body, which means we have a deep Secure a strong, diverse and sustainable Skills understanding of the needs and solutions for developing skills and supply of chemical scientists at all levels. upholding standards in the chemical sciences at all levels. Our role supporting chemistry both as a scientific discipline and a Bring together and empower the global Community profession, and our global membership, means we are uniquely placed chemistry community for the benefit of to bring together and represent the chemical sciences community. science and humanity.

Engage and support members at all levels Our global network of expert and engaged members who support our to strengthen our mandate to act from our Member engagement organisation and our mission. community, better achieve our Charter objectives and increase our influence.

Organisational Our commitment to long-term stewardship and long-term strategic Equip the organisation to grow sustainably strength planning, which has enabled us to adapt and grow for 175 years. and confidently.

2 Achievements and performance

Knowledge Measuring success Our objective: Make the best chemical science Publish the largest share of quality* chemical knowledge available to all those who need it. sciences research • We published 43,773 scholarly journal articles, an over 20% increase on 2014, making us the world’s biggest Overview publisher of quality chemical sciences research last We know that scientific advances don’t happen in year. isolation. The more that scientists are able to share • For the first time, we published 100 new book titles in information and ideas, the more rapid our progress a year. will be. • Our articles were downloaded 37.5 million times, a That’s why we’re committed to making the best chemical 14% increase on 2014. science knowledge available to all those who need it. *Defined as articles published in journals with an impact factor In 2015, we published more and higher-impact chemical of above 3. sciences research than ever before, making us the world’s biggest publisher of quality chemical sciences research. We also continued to shape the future of Open Access in the chemical sciences, so that research can be published in a sustainable, rigorous and accessible way. And we helped researchers share knowledge through our portfolio of scientific conferences, workshops and meetings, focused on major global challenges.

At a glance • Biggest publisher of quality chemical sciences research in the world. • 95% of authors, reviewers and readers say we value our customers. • 4 new journals and 100 new book titles launched. • 2.4 million visitors to the Chemistry World website. • Over 100 scientific conferences, symposia and workshops in 14 countries, across five continents.

3 Continue to increase the quality and quantity of Provide world-leading service in our publishing our journal portfolio operation • Our 2014* impact factors – a measure of the • In 2015, we held our first annual survey*of journal extent to which published research is cited by other authors, reviewers and readers. researchers in their work – show we are continuing to − 97% of respondents agreed we published high increase the quality of our journals. quality research. − We increased the Impact Factor of 70% of our − 95% agreed we value our customers. journals. Our overall publisher Impact Factor increased to 5.75, from 5.60 in 2013. − 98% of authors said their experience with us was at least as good as with other publishers, with two − Two of our journals topped their citation thirds saying it was better. categories. − We are using feedback from this survey to continue • We launched four new journals, covering growing to improve our service, and will conduct the survey areas of science and helping us reach new readers on a regular basis to track our progress. and authors: • We continued to improve our online submission and − Environmental Science: Water Research & peer review system, reducing our average publication Technology, focusing on this global challenge. time. − Nanoscale Horizons, which will publish research * 4,209 responses were received. of exceptional significance across the nanoscience field. Develop Chemistry World into a truly global − Our first two journals at the interface of chemistry chemistry magazine, with relevant content and and chemical engineering: Reaction Chemistry & editions for key markets, and increase the number Engineering and, in partnership with Institute of of visitors to the website Chemical Engineers, Molecular Systems Design & Engineering. • Our Chemistry World website, which covers news about and from the global chemistry community, * As journal impact factors are not released until June of the following received over 2.4 million visitors, 10% more than year, we do not have the 2015 figures at the time of the writing of this 2014, and reached 356,000 followers on Twitter and report. 712,000 on Facebook. • We continued to improve our Chemistry World content, developing a new book club podcast strand to support our review section and introducing leaders for our sections, to raise the profile of our editors and improve our influence in the community.

Increase the impact of our portfolio of scientific conferences, symposia and workshops that support fundamental chemistry and address our roadmap global challenges • We supported over 100 scientific conferences, symposia and workshops in 14 countries, across five continents. • We held our largest conference in over a decade, the 12th International Conference on Materials Chemistry, which attracted around 600 delegates from 59 countries. • We ran 12 Faraday Discussions on topics at the cutting edge of physical chemistry, ranging from single-molecule microscopy and spectrometry to carbon dioxide utilisation. • We held a workshop on the role of chemistry in tackling microplastics in the marine environment, which was attended by 40 experts from research, industry and NGOs, including the UK Department for Food and Rural Affairs, the European Commission and the United Nations Environmental Programme. • We partnered with other national chemical societies and research funders through the 2015 Chemical Sciences in Society Summit. This initiative brought together leading scientists from the UK, USA, Germany, China and Japan to determine how chemical sciences research can address global challenges in areas such as health, energy and water.

Shape the future of Open Access publishing, so research is published in a sustainable, rigorous and accessible way We believe the best model for achieving this objective “I have been inspired by your journals from my is Gold Open Access (OA), whereby researchers pay for early days. The Royal Society of Chemistry is the pioneer the publication of their papers. In 2015, we continued to in chemistry publishing and I am excited to publish my support the chemical sciences community to transition research with you and review journal manuscripts for you, to this model by: to support quality publication in my field.” • Making our flagship journal, Chemical Science, Gold Author OA from January. • Launching a partnership with the Royal Society to manage all of the chemistry content for its flagship “Your peer review is the best of all the journals. It is open access journal, Royal Society Open Science. very efficient, fast and fair. For example, problems such as • Rolling out our Gold for Gold scheme worldwide. This inconsistency between the editors’ and reviewers’ opinions scheme, launched in the UK in 2012, gives institutions are very rare.” that buy our Gold journal subscription package the Reviewer equivalent value of Gold OA vouchers. In 2015, we published 2,506 papers using the scheme. • Over 12,000 articles are now available via our “The Royal Society of Chemistry’s editorial process is Chemical Sciences Article Repository supporting much better than any other publishing group’s; the editors publication of Gold and Green Open Access. are very professional and efficient when handling the papers and pushing them through the system.” Author

5 Skills Our objective: secure a strong, diverse and sustainable supply of chemical scientists at all levels.

Overview If the chemical sciences are to fulfil their potential to improve our world, we need people with the right skills – now and in the future. As the chartered professional body for the chemical sciences, we work to promote and maintain high professional standards. We accredit chemistry degrees and company training schemes. We award a number of qualifications, recognising professional skills and integrity, including Chartered Chemist (CChem), Chartered Scientist (CSci), Registered Scientist (RSci), Registered Science Technician (RSciTech) and Chartered Science Teacher (CSciTeach). We also want to nurture the next generation of chemical scientists. That’s why we’re the biggest investor in UK Measuring success chemistry education, outside of the Government. We Campaign so that every primary school in the UK work with schools, teachers and students to help ensure has a specialist science teacher and all post-14 every child has access to an inspiring, relevant and year olds are taught by a chemistry specialist engaging chemistry education. • We continued our campaign on this issue. As well At a glance as meeting with MPs, we submitted evidence to the Education Select Committee on teacher supply • 36,000 teachers, students and advocates around the and responded to the consultation on the proposed UK engaged with by our education coordinators. National Improvement Framework in Scotland with • Awarded scholarships to nearly one in ten new trainee the Learned Societies Group. chemistry teachers. • We awarded Department for Education (DfE) • 2 million people used Learn Chemistry, our online hub scholarships to nearly one in ten new trainee for teachers and learners. chemistry teachers – 92 in total. In addition to selecting the candidates and managing the scheme, • 81,000 downloads of our new Periodic Table app. we provide scholars with subject-specific mentoring • Gave 17,000 students the chance to get hands-on and professional support. experience of spectroscopy. Increase our support for teachers by partnering • Certified 383 new chartered and registered with schools and colleges professionals. • More than 1,000 new schools and colleges signed up • Delivered the first year of Chemistry For All to widen to our Learn Chemistry Partnership. The programme, participation in chemistry. which helps schools make the most of our free teaching resources, now has 3,347 members – around half of all secondary schools and colleges in the UK. • In October, we concluded a two-year project funded by the London Schools Excellence Fund, during which we gave 542 schools and 1,920 teachers access to support and resources, including specialist training. We estimate more than 368,000 students have benefitted from the programme. • Our first group of 20 primary schools achieved the independent Primary Science Quality Mark. After this successful pilot, we have funded 17 clusters of up to six schools each to improve their science provision in 2015/16. • We signed agreements with Myscience and the ENTHUSE Charitable Trust, to make our range of face-to-face CPD courses for teachers available and accessible across the UK.

6 Widen participation within the chemical sciences so that our profession reflects the diversity of the wider population • 2015 was the first year of Chemistry for All, a five year project to understand and lower the barriers to participation at undergraduate level. We are providing a total of £1 million to five UK universities to work with local schools where few pupils go on to university, and to the Institute of Education to monitor the impact of the interventions. • We supported six people returning to chemistry research after a career break, in partnership with the Daphne Jackson Foundation. • Our annual Joliot-Curie conference brought together 64 early career researchers from under-represented groups, to offer them practical advice, inspiring talks, networking opportunities and moral support. • We continued our 175 faces of chemistry project to celebrate diversity in the chemical sciences ahead Engage school children with chemistry through of our 175th anniversary. We published on average effective outreach activities one inspiring story a week, including Dr Helen Sharman, the first Briton in space and a Departmental • In 2015, we nearly doubled our network of regional Operations Manager at Imperial College London, and education coordinators from 10 to 18. Last year, they Professor Chunli Bai, one of China’s leading scientists engaged with over 36,000 teachers, students and and President of the Chinese Academy of Sciences. advocates through outreach activities. • We helped 1,339 school children break the Guinness World Record for the ‘Largest practical science lesson’ at the Odyssey Arena in Belfast, in collaboration with the British Council, the Northern Ireland Science Festival and over 100 volunteer Science, Technology, Engineering and Mathematics (STEM) ambassadors. • 17,000 students had the chance to get hands-on experience of spectroscopy, a key chemical analysis technique, at one of our Spectroscopy in a Suitcase sessions.

Develop our online and mobile resources to reach more teachers and learners of chemistry • Two million people used Learn Chemistry, our online hub with more than 4,000 resources for teachers and learners, right from primary to PhD level. • We launched the first of a series of ten chemistry videos to give viewers the confidence to explore chemistry with children aged four to nine, part of a project by the Royal Institution that we have sponsored. • Our new Periodic Table app, a mobile version of our popular website, was downloaded more than 81,000 times from its launch in August to the end of the year. • Our Education in Chemistry (EiC) website, an online version of our magazine for teachers, had around 482,000 users, a nearly 50% increase on 2014. We also launched an EiC app, which was downloaded 3,362 times. • Over 80 teachers attended our first education webinar, on how to use technology in the classroom. The proportion feeling confident in using technology in the classroom rose from 51% to 85% by the end of the webinar.

7 Ensure that all UK students and their employers have sufficient and appropriate provision for vocational education • We continued our rolling programme of accreditation for over 95% of chemistry degree courses in the UK. • 23 companies have Royal Society of Chemistry accredited training schemes.

Connect young people to careers in chemistry • 343 people attended one of our webinars during ChemCareers, our free online careers fair, a 28% increase on 2014. Throughout the week, we ran “As a new graduate the job hunting process has been sessions on topics ranging from job searching to a daunting and sometimes disheartening experience. Having technical interviews. taken part in the Royal Society of Chemistry careers event • Over 500 students attended our ChemCareers event has totally changed my attitude and I feel so positive about in Delhi, India, which featured panel discussions on seeking work in the pharmaceutical industry. In fact the different sectors, as well as workshops on career webinars were so good I immediately posted links to my old planning, CV writing and interview preparation. class mates in our Facebook group. The 1:1 was stellar … I can’t thank the Royal Society of Chemistry enough for this Promote professionalism by awarding chartered careers event I feel very positive about the future now!” status, and increase admissions to Registered ChemCareers attendee Scientist (RSci) and Registered Science Technician (RSciTech) registers • We awarded chartered status to 219 professionals, “[The Daphne Jackson Fellowship gave me] bringing our total of new chartered professionals confidence, training and an opportunity to successfully apply certified since 2012 to 687. for other work.” • We certified 164 RSci/RSciTechs, bringing our total Chemist co-funded by the Royal Society of Chemistry to return to of new registered professionals certified since 2012 research after a career break to 371. • We have worked with the Gatsby Foundation to adapt the science access courses so that they met “To hold an accredited status [of RSciTech], is a our standards for RSciTech. Following a successful wonderful accomplishment, which will prove beneficial pilot, we rolled out the scheme nationwide for to future employment within the science sector … I firmly the academic year 2014/15, with 90 students believe the skills I have learnt through this programme will achieving the RSciTech. benefit me greatly in my future career, and were influential in me achieving my university place.” Recipient of RSciTech award

“The [Joliot-Curie] conference was actually one of the best and most useful conferences I have ever been to! I particularly appreciated and liked the frank and open delivery of talks and discussion. I’m looking forward to many more like it!” Early career researcher Community Our objective: bring together and empower our global chemistry community for the benefit of science and humanity.

Overview In an increasingly interconnected world, we need to work together to solve the challenges we face, from climate change to antimicrobial resistance. We support collaboration across borders, sectors and disciplines, whether by strengthening links between the UK and other centres of chemistry, bringing academia and industry closer, or helping researchers access the support they need to commercialise new technologies. Thanks to our global networks, we are also well-placed to support emerging chemical communities. Through our Pan Africa Chemistry Network (PACN), we bring African scientists together with international partners, to solve local challenges and contribute to global science. Finally, we recognise that for advances in the laboratory to fulfil their potential, chemical scientists need to Measuring success connect with the wider community. We advocate for Promote collaboration between chemical science policy decisions that will enable the chemical sciences researchers make their full contribution to society. • We signed a partnership agreement with the British And we help non-scientists access and use chemical Council to deliver Newton Fund Researcher Links science evidence – from giving policymakers access workshops, promoting links between UK chemists to independent expertise, to helping the general public and the global chemical science community. Our understand how chemistry affects their lives. commitment will be matched by funding from the UK Government, making more than £1.2 million available At a glance over three years for international collaboration. • Supported 23 Year in Industry placements for − The first workshop took place in Pretoria in students. September, bringing together around 40 early career researchers from the UK and South Africa to • Awarded grants for 43 research trips to institutions discuss materials-based hydrogen storage. in 13 countries. • We awarded researcher mobility grants to 43 early • Launched partnership with GSK to train 400 African career researchers for visits to institutions in 13 chemists. countries. • Launched our Chemistry Means Business event. • We held our first networking event for Royal Society • Conducted the first ever study into public attitudes to of Chemistry Fellows in Shanghai, China, with a focus chemistry in the UK. on increasing collaboration between academia and industry. More than 40 Fellows attended from all over • Successfully campaigned to protect the UK science China and we held site visits to Unilever and Lilly R&D budget in real terms. centres in Shanghai.

9 Support and nurture small companies in the Work with partners to support emerging scientific chemical sciences communities • 100 more companies joined our EnterprisePlus • We launched a five-year partnership with network, which helps small and medium sized GlaxoSmithKline (GSK) to train 400 African chemists companies (SMEs) in the chemical sciences access the in key analytical techniques in Kenya, Ghana, Ethiopia advice, networks and resources they need to grow, and Nigeria. Most importantly, Royal Society of bringing the total number of companies involved to Chemistry members and GSK volunteers will work to 280. develop local trainers to lead the programme in the future, ensuring it is sustainable for the long term. • We placed and provided funding for 23 students to spend their Year in Industry at 23 SMEs, more than • Our long-term PACN partner Procter & Gamble doubling the number of participants from 2014, the employed an intern at the University of Nairobi to first year of the scheme. work on a project to improve water quality in the Kibera slum, and provided the university with key − Our year one impact study found the scheme equipment for this research. improved skills for students across the board, and that over half of the participating SMEs intend to Continue to inform policy on issues related to the fund their own student or graduate placement in chemical sciences the future. • We issued a statement calling for action on climate • We launched a networking event for industry, change, in partnership with 23 other learned societies Chemistry Means Business, attended by more than and institutions, ahead of the landmark UN climate 200 members of the community, from SMEs to summit in Paris. investors, academics, entrepreneurs and decision makers. • We campaigned, independently and with other organisations in the sector, to make the case • We had 85 applications to our Emerging for protecting UK science funding. As well as Technologies Competition, which helps university engaging directly with policymakers, we created a teams and small companies commercialise booklet of impact studies showcasing successful innovations in areas of key importance for society, chemical science companies that started out as like healthcare, an 85% increase on 2014. Our nine university research projects, and submitted a formal winners each received up to £20,000 prize money representation to the Government’s comprehensive and personalised support from our multinational spending review. We were delighted that the science partner companies. budget was protected in real terms in the review.

10 Increase awareness among non-scientists so they understand the relevance of chemistry to their lives “The [Chemistry Means Business] event was very well organised and had a real buzz about it; building the two sessions • We conducted the first ever study on public attitudes for one-to-one meetings and networking into the programme to chemistry in the UK and found we have a great was very useful. The meeting really demonstrated how SMEs are opportunity to help the public connect more strongly part of the ‘powerhouse’ and future of the UK economy.” with chemistry. At the live-streamed launch hundreds EnterprisePlus company of people around the world discussed the findings and participated in the event on Twitter, and we shared the findings with our members and the wider chemical sciences community at various events throughout the “[The RSC Industrial Placement grants are] a great way to year. encourage and support new SMEs to host a placement student. • We have also created a communications toolkit, Brings the potential benefits of placement schemes to SMEs available for free on our website, to help chemists which now make up such a large proportion of the UK chemistry communicate with the public more powerfully. sector.” • We supported 62 projects through our Tom Screen CEO, YproTech Outreach Fund, ranging from the Nappy Science Gang, a citizen science project that caused the NHS to overturn advice against using biological detergents, to MolCraft, a Minecraft world of molecules created “We had an excellent group of participants [in the Newton at the University of Hull, which is engaging new Fund workshop], both from the UK and South Africa. The range audiences with chemistry. of participants – mainly early-career researchers – was just right, having been selected from a strong pool of applicants in both • We hosted a Wikimedian in residence to help us countries. The presence of some leading researchers as mentors improve chemistry-related content on Wikipedia, worked very well. The range of topics covered by the talks meant which evidence suggests is the primary resource that all participants learnt something new.” for many people looking for information about the subject. He worked with our outreach team from Professor Robert Mokaya, of the University of Nottingham September 2014 to September 2015 to engage members of staff and the wider public in the project. • ChemNet, our online community for young people, “Inspiring stuff, it will change the way I do things. reached 30,530 members, a third of whom we #chemperceptions. For starters I’m retiring the use of actively engaged with online to encourage their #chemophobia” interest in chemistry. Dr Mark Lorch (@sci_ents), on Twitter during Public Attitudes to Chemistry research launch.

11 Member engagement Measuring success Our objective: engage and support members at all levels Continue to increase our core membership, to strengthen our mandate to act from our community, focusing on professional and student members better achieve our Royal Charter objectives and increase • We continued to grow our overall membership to our influence. 54,095, up from 51,561 at the end of 2014. • As part of our focus on supporting professional Overview skills, we are focusing particularly on growing our Our members are the lifeblood of our organisation. professional category and student members. We We have an incredibly diverse and expert community, increased our members in these categories to 36,369 with members in more than 125 countries, working in and 10,734 respectively, up from 35,899 and 9521 at almost every branch of the chemical sciences and across the end of 2014. industry, government, academia and education. Increase our careers support for members We support our members’ professional development • We held 359 one-to-one careers consultations in through careers advice, networking opportunities, person or by phone and 750 email consultations. access to scientific updates and grants for research trips. We work with them to shape and deliver our wider • We rolled out a member-to-member mentoring strategy. scheme, after a successful pilot in 2014. By the end of the year, 33 mentoring relationships had been At a glance established. • Grew our membership to over 54,000. • In October, we held the first committee meeting of our Early Careers Network, to support members near • Increased our numbers of student and the start of their professional journeys. professional members. • Rolled out member-to-member mentoring scheme. Support our members to be effective advocates for chemistry • Held over 1,000 careers consultations with members. • We held our first ever outreach conference, bringing • Held our first outreach conference for members. members from local sections together with our • Launched our Inspirational Member awards. education coordinators and staff, to share best practice and discuss our public attitudes research.

• We launched our Chemistry Week grants, open only to our members, to support outreach activities during the biannual event. We funded 31 events during the week, delivered by 26 Local Sections.

• 219 MPs were contacted by our members in support of our campaign to ring-fence the science budget, and 201 elected representatives in the devolved administrations were contacted by members in support of our education campaign.

Recognise innovative and inspiring work by members • We launched our new Inspirational Member and Committee Awards, in addition to our existing Awards for Service. These highlight particularly innovative work to serve local member communities and bring chemistry to new, diverse audiences. Organisational strength Our objective: equip the organisation to grow sustainably and confidently.

Overview The Royal Society of Chemistry has evolved and grown over 175 years to become an international organisation with significant resources and a strong reputation. We have a duty to use these assets wisely to deliver our mission, and to nurture them so we continue to flourish in the long-term. Our aim is to equip our organisation to grow sustainably and confidently, so it can continue to deliver our other strategic objectives, and meet the changing needs of the chemical science community.

Measuring success Support our people to deliver our mission Strengthen and protect our brand efficiently and effectively • We created a brand centre for our member • We completed a restructure of our Technology committees, so they can produce and order materials directorate so it is better able to support our – whether outreach presentations or promotional staff, members and wider community, and drive items – that use our brand to best effect. organisational performance. This includes developing our chemical data management capacity to support • We created new logos for our nine divisions, 35 local publishing, specifically data publishing. sections, 25 international sections and 67 interest groups, to help strengthen our reputation and the • We reviewed internal communications and have consistency of our logos and make it easier for people devised new systems designed to keep all staff to recognise and remember us. connected with the strategy, enabling better planning and decision-making. Ensure long-term financial stability • We opened our new office in Bangalore, India, to • We continued to maintain a healthy level of reserves support our expanding programme of activities and to protect the organisation against risks and ensure growing publishing relationships in the country. our long-term sustainability. Monitor and manage opportunities and risks • We launched the Future of Chemical Sciences initative, exploring what the chemical sciences and chemists will look like in 2025–2030, so we can better understand the future needs of the community that we represent, and shape our future strategy. We held a series of workshops with leading experts from industry, academia and the policymaking community to test a range of scenarios.

13 Plans for the future

Overview Skills 2016 will be a transition year for our organisation, as we • Nurture talent at every stage of the skills pathway and deliver the final year of our current strategy and prepare recognise and support all routes to the profession. to launch our new strategy in 2017. • Promote a scientifically-literate population. In 2014 and 2015 we distributed a portion of our reserves in a number of significant initiatives supporting Community the chemical sciences community. We were able to do this because our growing surplus from operating • Engage our communities as advocates for advancing activities and investment had increased those reserves the chemical sciences. significantly. • Engage, enthuse and inform public audiences to Our reserves remain at a healthy level and we will increase understanding of the importance and impact continue to draw upon them in 2016 to fulfil our strategic of the chemical sciences. objectives. As we come to the end of our current strategic planning Member engagement cycle, we also recognise that this is an appropriate time • Engage and support all member networks on a to transition to a balanced and sustainable budget. regional basis with clear routes to governance. Throughout 2016, we will be reviewing our activities to • Increase member engagement, pride, loyalty and ensure a smooth transition to our new strategy, and a advocacy for the Royal Society of Chemistry. balanced budget in 2017. • Ensure the diversity of the chemical sciences is Our strategy for 2017 and beyond will build on the represented in our membership. success of our current one, focusing on our core charter objectives and our roles as a leading publisher of chemical sciences research, the professional body Organisational strength for UK chemists and as an influential voice for the global • Provide robust leadership and governance. chemical community. • Maintain sufficient reserves to support the Key strategic goals for 2016 organisation’s future activities. • Provide appropriate workforce and infrastructure to Knowledge deliver the activities of the organisation. • Position the Royal Society of Chemistry knowledge • Review our activities to ensure a smooth transition resources as the first choice for authors, readers, to our strategy for 2017 and beyond, and a balanced educators, learners and decision-makers. budget in 2017. • Bring together the global science community to address global challenges.

14 Benevolent Fund

The Benevolent Fund supports our members and their − A legal advice telephone service, delivered by families in times of difficulty, whether by providing Law Express. The service is staffed by a team confidential advice and financial assistance to those in of experienced legal advisors who can give need, or, where appropriate, signposting members to information about a beneficiary’s legal position and other charities or organisations. options and direct them to further resources. The Benevolent Fund Grants Committee is made up of − A counselling service provided by Anxiety UK. This Royal Society of Chemistry members who give strategic service assists members in financial hardship who direction to the activities of the Fund, and make decisions may be struggling to access therapeutic support in regarding financial support for individuals. their time of need.

Changes to the Benevolent Fund The review also recommended changing the name of the Fund to Chemists’ Community Fund, to reflect its A strategic review of the Benevolent Fund was completed changed remit. This change was implemented in January in 2014, which recommended broadening the Fund’s 2016. remit to make it more relevant for our community and better serve the needs of our members. In 2015 we The Fund continues to grow and we continue to explore implemented many of its recommendations, including: opportunities to apply funds effectively to support our members. • Expanding the remit of the Fund to include the prevention of poverty as well as the relief of poverty. • Introducing a new guideline for awarding grants to UK applicants based on comparing the household income of an applicant with the Minimum Income Standard (MIS)1*. This helps the Committee decide the type and level of support an applicant receives.

• Introducing three new services with the aim of making the Fund more relevant to the needs of our members:

− An intensive careers programme, delivered by Chiumento, an established UK careers firm. This service complements the support offered by our in-house careers specialists, providing up to six months of face-to-face career consultations * The MIS is published annually based on nationwide research by the with trained career coaches, for those who might Joseph Rowntree Foundation. It contains figures for how much income benefit from a longer programme of consultations different households require to have a socially acceptable standard of living. Before making the assessment on an applicant’s income, housing or more local support. costs are subtracted, and we exclude any disability payments directly related to supporting independence or care.

15 Core activities In addition to implementing the forementioned reforms, Staff also responded to 110 enquiries from people our core activities continued in 2015. seeking confidential support on issues ranging from debt to claiming appropriate state benefits and care. Our staff The committee considered 39 case papers across the consult with members so they can signpost them to the four meetings held. Of these: appropriate resources. This can take the form of helping • 16 beneficiaries were given financial assistance (9 of them to apply for financial assistance from the Fund, these were outside the UK). directing them to the third-party careers, counselling or legal services we offer, or putting them in touch with • In 2 cases no financial assistance was awarded. other organisations that can provide the relevant expert • 9 cases were closed. advice. • 3 UK loans were reviewed. In addition, we have a network of 102 trained volunteers, Financial support can take the form of one-off grants for predominantly in the UK. Some are actively involved those who need support to meet short-term needs (such in visiting existing or potential beneficiaries to help as for medical costs or domestic repairs), or a regular them with the application process. Others provide peer charitable grant for those who do not have a sufficient support, and are a local point of contact for isolated regular income to cover basic living costs owing to members of our community. Last year, our volunteers circumstances beyond their control, such as redundancy made 68 visits to members in need. or illness. We work with other charitable organisations to help our beneficiaries become self-sufficient wherever possible. We also work closely with similar funds and charities to share information on best-practice.

16 Financial review

strong, diverse and sustainable supply of chemical Financial performance scientists at all levels, increasing total expenditure to £7.2m (2014: £5.2m). Overview This section outlines the key elements of our income and Community expenditure in 2015 and how they relate to our strategic 2015 was an important year for engaging policymakers priorities. and the public with the chemical sciences. The main charity (excluding Chemistry Innovation Limited) Knowledge increased spending on advocacy and awareness activities Publishing and Chemistry World to £4.4m (2014: £4.0m). Our publishing operations are central to achieving Across the group, overall expenditure on advocacy and our objective of making the best chemical science awareness fell as we wound down the operations of knowledge available to all those who need it. Chemistry Innovation Limited, the Knowledge Transfer Network (KTN) set-up in 2006 in partnership with the UK In 2015, our publishing revenues grew by 5.9% in 2014, government. This led to an overall £0.8m reduction in generating 80.0% (2014: 78.2%) of our total income. This both income and expenditure compared to 2014. was achieved despite difficult market conditions and ensured that our publishing operations maintained a net surplus of £7.1m (2014: £6.9m). Member engagement In 2015, we grew our member network and increased A portion of the surplus has been invested in the professional support available to members. As a result, continued development of our publishing products and we increased total spending on membership by 6.0% services, in particular Chemistry World magazine, while to £4.7m. This led to a larger financial deficit against the majority has been used to fund our other charitable membership subscriptions than in 2014, but brought activities and our running costs. many non-financial benefits as discussed under our review of member engagement activities on page 12. Scientific conferences and events Last year, we continued to support the exchange of Organisational strength scientific knowledge through high-quality conferences and symposia. We spent £4.2m organising and Our overall financial position and management of risk, sponsoring conferences and symposia, with the as described in this financial review, is a key element of reduction compared to 2014 owing to several major our organisational strength. While we also made several biannual events due to be held in 2016. improvements to our operations to allow us to grow sustainably and confidently, these support costs have Skills been allocated across other areas, as shown in Note 8 of the financial statements. We significantly expanded our education and professional practice programmes to help secure a

17 At a glance Financial position

Overview From 2008 to 2014, our reserves increased significantly owing to the growing surplus from operating activities and investments. In 2014, we began to distribute some of these additional reserves through expanded charitable activities to advance excellence in the chemical sciences, focused on our strategic objectives. We continued to distribute a portion of our excess reserves in 2015. This allowed us to increase our charitable expenditure. As shown within our cash flow statement, we used £7.0m net in 2015 on our operating activities (2014: £6.9m). We funded this by withdrawing £7.0m from our investments, leading to a year-on-year reduction in the value of our Total income: £54.0m (2014: £52.1m) investment portfolio. It should be noted that the value of this portfolio had increased significantly over the previous Fundraising and other income £3,425k four years, owing to investment gains. Working capital Publishing £43,132k remains negative owing to the large advance payments received for 2016 journal subscriptions. Chemistry World £1,190k Overall our financial position remains healthy, Membership £3,701k with substantial reserves readily available to fund Scientific conferences and events £1,664k future activities. Advocacy and awareness £114k As discussed on page 14, we are now reviewing our activities in order to achieve a balanced budget, Education and professional practice £763k with 2016 planned as a transition year and a period of consolidation.

Definitions General funds – these funds represent the assets freely available to spend and use on any of our charitable activities. Reserves – The total value of assets (net of liabilities) held by the charity, described as total charity funds on the balance sheet. Fixed assets – assets purchased for long-term use and not likely to be quickly converted into cash. This includes, buildings, equipment and intellectual property. Working capital – the capital which is used in our day-to-day trading operations, calculated as Total expenditure £60.1m (2014: £55.8m) the current assets (e.g. cash, stock, trade debtors) minus the current liabilities (e.g. trade creditors). Fundraising and other income £988k Defined benefit (DB) pension liability – the net Publishing £36,066k deficit on our pension scheme, representing the Chemistry World £2,562k difference between valuations of the pension scheme assets and liabilities. Membership £4,729k Scientific conferences and events £4,165k Advocacy and awareness £4,362k Education and professional practice £7,234k

18 At a glance Reserves policy We review the need for, and the appropriate level of, General Funds (£,000) reserves on an annual basis. We endeavour to take into account all relevant information, including the risks identified in the Risk Register. Working capital Fixed assets In defining our reserves policy, we have considered the Investments DB pension liability level of available reserves that it is appropriate to hold, in order to demonstrate appropriate financial management and financial sustainability. Available reserves represent unrestricted general funds of the Royal Society of Chemistry and exclude both the restricted funds held and funds that have been designated by the Trustees. The available reserves also exclude any funds that could only be realised by disposing of fixed assets held for charitable use. 64,838 71,346 On this basis, we currently target to maintain available reserves of £50.0m, which would allow us to maintain investments that can generate an average annual return of £2.5m. A return of this level will ensure the sustainability of the Royal Society of Chemistry in the event that publishing revenues were to significantly decrease. The level of accumulated available funds held at 31 11,421 12,818 December 2015 was £52.7m (2014: £50.9m) – £2.7m greater than our stated target of £50.0m (2014: £0.9m). (6,000) As a result, investments were maintained that generated (10,492) total returns of £2.2m (2014: £7.0m). We are forecasting to use the excess available funds in 2016 on our (17,579) (25,562) continuing charitable activities.

2015 Restricted and Designated Funds Our strategy for the Benevolent Fund and trust funds is 2014 to maintain capital over the long-term while generating income to meet current and expected expenditure levels. Investments Total reserves held at 31 December 2015 were £24.9m (2014: £24.2m). We hold financial investments to maximise overall return whilst maintaining an appropriate level of risk in The Designated Funds relate to reserves held by the context of our strategic objectives. Our investment branches of the Royal Society of Chemistry and include portfolio is designed to ensure long-term growth and our Local Sections, Regions and Interest Groups. The to provide additional funding to support our charitable balance of the designated funds at the 31 December objectives. Responsibility for investment policy resides 2015 was £2.0m (2014: £2.0m). Each of the Groups has a with the Investment Committee whose members have committee, which meets during the year to discuss ideas financial backgrounds, and which reports to the Finance and initiatives to further chemistry in local and specialist and Resources Board. areas. With advice from JLT Benefit Solutions, the committee Pensions decides on the ranges of investments within the portfolio. Investments were held with BlackRock, Royal We operated a Defined Benefit Pension scheme for London Asset Management, Schroders, Kames Capital, employees who joined before January 2003. Employees Sarasin Investments, Newton Investments and Payden & who joined after that date are entitled to join a Defined Rygel. Contribution scheme. The Defined Benefit Pension scheme commits to pay a pension based on the number The fixed asset investments of the General, Restricted of years worked and the final salary of the members. and Designated Funds are combined for investment purposes in order to obtain lower management fees. This is now closed to new members. The scheme therefore represents a commitment by the Royal Society Financial markets were volatile in 2015 and total of Chemistry to pay members a pension (scheme liability) investment income fell to £2.5m (2014: £3.1m), with and this is paid from the fund managed by the pension investment gains of £0.8m (2014: £5.8m). However, Trustees (the scheme asset). performance over the last five years has outperformed their benchmarks and provided substantial additional FRS 102 is the accounting standard that dictates how the funding for our charitable purposes. scheme is presented in the financial statements and the valuation is determined by an actuary.

19 The FRS 102 valuation of the deficit on the Defined As an organisation, we make long-term financial Benefit Pension Scheme amounted to £17.6m at the end commitments on a range of projects and activities. To of 2015 (2014: £25.6m). This followed a decrease in the ensure that these do not undermine the liquidity or long- liabilities of the scheme of £7.8m, attributable to changes term stability of the Royal Society of Chemistry, these in the actuarial assumptions. commitments are only made in the context of detailed budget and forecasting information and in reference to Over time, the deficit will vary in line with market interest our charter objectives. rates and equity returns and may ultimately become a surplus. Given the length of time over which the pensions The success of our operations is built upon our will be in existence, the FRS 102 figures represent only reputation and our financial strength. We have members a best estimate of the final position if existing market across 125 different countries and, through RSC World factors remain unchanged. Limited, own subsidiaries in the United States, India, China and Japan. We therefore maintain insurance Following a triennial valuation of the pension scheme in against loss of business and assets, as well as Trustee January 2014 we have agreed a recovery plan with the indemnity insurance. We review all insurance cover pension Trustees to address the 2011 deficit resulting annually using independent advisers. The range of from this valuation. The recovery plan will see annual our global operations also increases the risk of non- payments commencing on 31 March 2015, with an initial compliance with local legislation and regulation, which payment of £958k being increased by 3% each year until could affect our reputation and financial position. We February 2023 inclusive, when the shortfall is expected manage this through locally based staff and advisors to be eliminated. and monitor issues through an International Operations Risks Group comprised of senior managers from across our The Royal Society of Chemistry’s Risk Register details organisation. the significant risks to which we are exposed. This is Audited Financial Statements strategically reviewed and amended at least once a year The audited accounts for the year ended 31 December by the Audit Committee. The most recent update was 2015 are included on pages 28-59. approved by Council on 4 December 2015. The Charities SORP (FRS 102), issued by the Charity We use the following controls to mitigate risk: formal Commission has been adopted in the financial agenda for all committee and board activity, detailed statements in 2015. As a result of this the figures for terms of reference for all committees, comprehensive 2014 have been restated. It has led to a revision of the strategic planning, budgeting and management categories in the Statement of Finance Activity (SOFA) to accounting, established organisational structure, clear improve transparency and to better reflect the current lines of reporting and clear authorisation levels. The activities of the charity. Royal Society of Chemistry mitigates risk from economic conditions by regularly reviewing its risk profiles to make sure all relevant risks are captured and the level of risk along with any mitigating factors are covered. With 80% of revenue generated through our publishing operations, our other charitable activities currently rely upon the continued success of our journals. Therefore our principal risk as an organisation is for there to be a significant downturn in our publishing revenue. To manage this risk, we continue to monitor market developments and develop our business strategy to ensure that we maintain our world-leading position as a publisher of chemical sciences research. As well as a competitive market, the total surplus generated by our publishing operations can be significantly affected by other external factors. Publishing revenues in US Dollars (USD) exceed our levels of USD expenditure. This leads to a USD surplus and means that our overall financial position can be significantly affected by the USD:GBP exchange rate. To manage this risk, forward exchange contracts are used to manage exposure and reduce uncertainty over future revenues.

20 Any member of the Royal Society of Chemistry may Structure, governance and stand for election as an Ordinary Member of Council management and any Fellow may stand for election as President or Honorary Treasurer. All members are eligible to nominate The Royal Society of Chemistry is a registered charity candidates and to vote in elections. Council itself may governed by a Royal Charter that was granted on 15 May also make nominations. Voting takes place by post or 1980. electronically and is managed by an external provider We are governed by a Council, members of which act as approved by Council. Election of Ordinary Members of our Trustees and are elected or appointed in accordance Council normally takes place every two years. The next with our Charter and by-laws. election will be for Ordinary Members to take office after the 2017 AGM. The Council comprises: Our governance bodies develop strategic planning and • Elected members. policies with the support of staff and approval by the • President. Council, which delegates the day-to-day management and implementation through the Chief Executive to the • President Elect or Immediate Past President. staff. Members of staff provide updates on progress to • Honorary Treasurer. the governance bodies, which, in turn, report to the Council on achievements against our strategy. • Nine Ordinary Members of Council. Each board has a chair appointed by Council. More • Up to six appointed members, who may be Chairs of details on the current structure and membership of each the Boards or other persons appointed by Council. board can be found on our website: http://www.rsc.org/about-us/our-structure/#boards- committees

Honorary officers and Leadership team Council

• Audit Committee • Performance Management & Disciplinary Committee Remuneration Committee • Nominations Committee

Membership and Science, Education and Finance and Resources Publishing Board Qualifications Board Industry Board Board

Figure 1: Organisational chart to illustrate Royal Society of Chemistry governance

21 Council has oversight of the Royal Society of Chemistry’s The Trustees have considered the public benefit guidance involvement in the Science Council, the European published by the Charity Commission. The Trustees Association for Chemical and Molecular Sciences are satisfied that Royal Society of Chemistry activities (EuCheMS) and the European Technology Platform for provide public benefit by advancing the chemical Sustainable Chemistry (SusChem). sciences through publishing chemistry books, journals Remuneration of key management personnel and magazines, informing and influencing policy makers, supporting and advancing chemical science education, The ‘Performance Management and Remuneration recognising and regulating professional standards in the Committee’ is responsible for: chemical sciences, organising meetings, conferences and networking events and informing and engaging the • Setting objectives for, and reviewing the performance public. of the Chief Executive Officer (CEO) and to determine his/her salary in accordance with the Royal Society of All members of Council and its boards and committees Chemistry’s performance management procedures. give of their time voluntarily to the Royal Society of Chemistry. • On the basis of recommendations from the CEO, discussing and agreeing any major changes to the duties of senior staff i.e. the Deputy Chief Executive Officers (DCEOs) and the Leadership Team, their annual remuneration, and any change in the number of such posts. • Ensuring that appropriate benchmarking is in place in order to understand how the salary and remuneration packages of the CEO, DCEOs and Leadership Team members compare to those in similar organisations. • Providing general advice to the CEO (in accordance with by-law 74) on people management issues. Remuneration for the Chief Executive Officer, Deputy Chief Executive Officers and the Leadership Team is reviewed on an annual basis simultaneously with the annual staff pay review.

Trustees At the date of signing the Trustees’ report, the Council members are the Trustees of the Royal Society of Chemistry. A list of the appointed Trustees for the period from January 2015 to the date of this report is shown on page 25. All Council members are required to attend Trustee training sessions covering the responsibilities of Trustees and Royal Society of Chemistry financial and business planning and strategy development. Trustees are also offered access to external training. We take governance very seriously and have an induction programme for all new Trustees to educate them and provide assistance in their new role. We also provide a governance handbook and trustee induction pack that they are asked to familiarise themselves with. A skills audit is also carried out annually to ensure the make-up of Council reflects the diversity of skills that is required to drive the Royal Society of Chemistry strategy forward.

22 Subsidiary companies • Royal Society of Chemistry Japan KK. • Chemistry Innovation Limited. Overview • Friends of the RSC Inc. The Royal Society of Chemistry has two wholly owned The non-controlling interest in Chemistry Innovation UK registered subsidiaries, Chemistry Limited and RSC Limited has not been recognised separately in the Worldwide Limited. The profit on ordinary activities financial statements on the grounds of materiality. before taxation for Chemistry Limited was £173k (2014: However it is shown in Note 21 of the financial £21k). The profit on ordinary activities before taxation for statements. RSC Worldwide Limited was £3.4m (2014: £36k loss). Connected charities The principal activity of RSC Worldwide Limited is to facilitate Royal Society of Chemistry activities overseas; The Royal Society of Chemistry jointly administers the Sir included in this is holding the ChemSpider asset. George Beilby Memorial Fund. An annual prize of £1k is ChemSpider is a chemical structure database providing awarded and sustained by a trust fund commemorating fast text and structure search access to over 43 million Sir George Beilby FRS, President of the Society for structures from hundreds of data sources. In 2015 RSC Chemical Industry (SCI) (1898-99), the Institute of Worldwide Limited continued to facilitate operations Chemistry (1909-12) and The Institute of Metals (1916- in the US, China, India, Japan, Brazil and Germany. 1918) and founding Chairman of the Fuel Research The expenditure associated with RSC Worldwide Board. The award is administered in rotation by the Limited activities is the result of the Royal Society of Royal Society of Chemistry, the Institute of Materials, Chemistry continuing to advance the chemical sciences Minerals and Mining and the SCI. It recognises substantial internationally. work of exceptional practical significance in chemical engineering, applied materials science, energy efficiency RSC Worldwide Limited set up a Wholly Foreign Owned or related field, and is made to scientists or engineers. Entity in China, Wholly Owned Subsidiary in India and a The assets of the fund are held in a named portfolio Wholly Owned Kabushiki Kaisha company in Japan. with Schroders Investment Management Limited. The The principal activity of Chemistry Limited is to facilitate Royal Society of Chemistry’s share of the fund has not the non-primary purpose trading of the Royal Society of been consolidated within the Consolidated balance Chemistry. sheet and Statement of financial activities on the basis of materiality. The Royal Society of Chemistry owns 67% of Chemistry Innovation Limited. The loss on ordinary activities The Royal Society of Chemistry works with a broad range before taxation was £34k (2014: £1k). The non- of UK and international charities; details are available on contolling interest is disclosed in Note 21 of the financial request. statements. The principal activity of Chemistry Innovation Limited was to facilitate knowledge transfer, collaborative working and research and development projects between chemistry related industries and the science base. The company ceased activities in 2015 and the directors, along with the shareholders, have agreed to dissolve the company. The Royal Society of Chemistry also controls Friends of RSC Inc., a charity registered in the United States which receives donations to support our wider charitable objectives. Consolidation is shown on page 28 We have reflected in the Consolidated statement of financial activities and Balance sheet the following entities covered by the Royal Society of Chemistry charity registration: • Chemistry Limited. • RSC Worldwide Limited. • RSC Worldwide (US) Inc. • RSC (Beijing) Chemical and Science Technology Company Limited. • Royal Chemistry India Private Limited. • Royal Chemistry India Foundation

23 Reference and administrative Auditors, bankers and other professional details advisors Auditor Charity number RSM UK Audit LLP The Royal Society of Chemistry’s charity registration 25 Farringdon Street number is 207890 and this registration encompasses the London RSC Benevolent Fund, the Royal Society of Chemistry EC4A 4AB and its regional and interest groups. Bankers Leadership team for the year 1 January National Westminster Bank plc 2015 to 31 December 2015 Market Street Branch 23 Market Street Chief Executive Cambridge Dr Robert Parker CSci CChem FRSC CB2 3PA

Deputy Chief Executive Nationwide Building Society Dr Helen Pain CSci CChem FRSC Nationwide House Pipers Way Deputy Chief Executive Swindon Stephen Hawthorne SN38 1NW Close Brothers Ltd Director of Membership & External Affairs 10 Crown Place Clare Viney CSci CChem FRSC London EC2A 4FT Finance Director Martin Dachs FCA (appointed 7 May 2015) C. Hoare & Co Nick Hills ACA (resigned 6 May 2015) 37 Fleet Street London Director of Sales EC4P 4DQ Dan Dyer Citizens One Citizens Plaza, Director of Technology Providence Dr Frank Gibson RI 02903 USA Director of Human Resources and Organisation Development Investment managers Karen Roberts MCIPD Schroder Investment Management (UK) Limited 31 Gresham Street Director of Publishing, Journals and Databases London Dr Emma Wilson MRSC EC2V 7QA Director of Education BlackRock Sarah Robertson 33 King William Street London Director of Communications and Marketing EC4R 9AS Kate Tonge Royal London Asset Management 55 Gracechurch Street London EC3V 0UF Payden & Rygel 1 Bartholomew Lane London EC2N 2AX Kames Capital Plc 4th Floor 77 Gracechurch Street London EC3V 0AS Newton Investment Management Limited BNY Mellon Centre 160 Queen Victoria Street London EC4V 4LA

24 Investment adviser Appointed members JLT Benefit Solutions Chair, Science, Education and Industry Board 36 Ridgemont Road Professor Mike Ashfold CChem FRSC FRS St Albans Chair, Publishing Board AL1 3AB Professor Helen Fielding CChem FRSC Legal advisers Chair, Membership and Qualifications Board Charity and employment matters: Professor Tom Welton CChem FRSC (from 9 July 2015) Taylor Vinters Merlin Place Dr Janette Waterhouse EurChem CChem FRSC Milton Road (until 8 July 2015) Cambridge Professor Ben Feringa CChem FRSC CB4 0DP Professor Sir John Holman CChem FRSC Commercial matters: (until 8 July 2015) Mills & Reeve LLP Dr Keith Layden FRSC Botanic House 100 Hills Road Ordinary members Cambridge Professor Alison Rodger CChem FRSC CB2 1PH Professor Peter Knowles CChem FRSC FLSW Benevolent Fund matters: Dr Helen Neville FRSC Eversheds Kett House Professor Polly Arnold CChem FRSC FRSE Station Road Professor Sabine Flitsch CChem FRSC Cambridge CB1 2JY Professor Melissa Hanna-Brown CChem FRSC Principal office Dr David Rees CChem FRSC Royal Society of Chemistry Dr Janette Waterhouse EurChem CChem FRSC Burlington House (from 8 July 2015) Piccadilly Professor Tom Welton CChem FRSC London (until 9 July 2015) W1J 0BA Professor Duncan Bruce CChem FRSC Royal Society of Chemistry Council (retired 8 July 2015) Patron Dr Annette Doherty OBE FRSC Her Majesty The Queen (retired 8 July 2015) Council members for the year 1 January Professor Emma Raven CChem FRSC (retired 8 July 2015) 2015 to 31 December 2015 Professor Gillian Reid FRSC Honorary officers (retired 8 July 2015) President Dr Derek Stevenson CChem FRSC Professor Dominic Tildesley CBE FRSC (retired 8 July 2015) President Elect Professor Sir John Holman CChem FRSC (from 8 July 2015) Past President Professor Lesley Yellowlees CBE FRSC FRSE (retired 8 July 2015) Honorary Treasurer Professor David Grayson CChem FRSC

25 Responsibilities of the Trustees Statement of Trustees' responsibilities in respect of the Trustees’ report and the accounts The Trustees are responsible for preparing the Trustees’ report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).The law that is applicable to charities in England and Wales requires the Trustees to prepare financial statements for each financial year that give a true and fair view of the state of affairs of the group and the charity and of the incoming resources and application of resources of the group for that period. In preparing those financial statements, the Trustees are required to • select suitable accounting policies and apply them consistently. • observe the methods and principles in the Charities Statement of Recommended Practice (SORP). • make judgements and estimates that are reasonable and prudent. • state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements. • prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Royal Society of Chemistry will continue in business. The Trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the group and the charity and to enable them to ensure that the financial statements comply with the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008 and the provisions of the Royal Charter. They are also responsible for safeguarding the assets of the group and the charity, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Trustees are responsible for the maintenance and integrity of the charity and financial information included on the charity’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

On behalf of the Trustees

Professor Dominic Tildesley CBE FRSC, President

26 Emphasis of matter – early adoption of the Independent auditors' report Charities SORP (FRS 102) to the Members of the Royal In forming our opinion, which is not modified, we have Society of Chemistry considered the disclosure in Note 1 concerning the charity’s early adoption of the Charities SORP (FRS 102) We have audited the financial statements of the Royal issued in July 2015, rather than applying the Charities Society of Chemistry for the year ended 31 December 2005 SORP which has been withdrawn but is still 2015 on pages 28 to 59. The financial reporting referred to in the extant Charities (Accounts and Reports) framework that has been applied in their preparation Regulations 2008. This departure has been necessary for is applicable law and United Kingdom Accounting the financial statements to show a true and fair view in Standards (United Kingdom Generally Accepted accordance with United Kingdom Generally Accepted Accounting Practice) including FRS 102 “The Financial Accounting Practice effective for accounting periods Reporting Standard applicable in the UK and Republic of beginning on or after 1 January 2015. Ireland”. This report is made solely to the charity’s trustees as a Matters on which we are required to report by body, in accordance with the Charities Act 2011. Our exception audit work has been undertaken so that we might state to the charity’s trustees those matters we are required We have nothing to report in respect of the following to state to them in an auditor’s report and for no other matters where the Charities Act 2011 requires us to purpose. To the fullest extent permitted by law, we do report to you if, in our opinion: not accept or assume responsibility to anyone other than • the information given in the Trustees’ report is the charity and the charity’s trustees as a body, for our inconsistent in any material respect with the financial audit work, for this report, or for the opinions we have statements; or formed. • the parent charity has not kept sufficient accounting Respective responsibilities of trustees and auditor records; or As explained more fully in the Statement of Trustees’ • the parent charity financial statements are not in responsibilities set out on page 26, the Trustees agreement with the accounting records and returns; are responsible for the preparation of the financial or statements and for being satisfied that they give a true • we have not received all the information and and fair view. explanations we require for our audit. We have been appointed as auditors under section 151 of the Charities Act 2011 and report in accordance with regulations made under section 154 of that act. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s (APB’s) Ethical Standards for Auditors.

Scope of the audit of the financial statements A description of the scope of an audit of financial statements is provided on the Financial Reporting Council’s website at http://www.frc.org.uk/auditscopeukprivate

Opinion on financial statements In our opinion the financial statements: RSM UK AUDIT LLP (formerly Baker Tilly UK Audit LLP) • give a true and fair view of the state of the group’s and Statutory Auditor charity’s affairs as at 31 December 2015 and of their 25 Farringdon Street incoming resources and application of resources for London the year then ended; EC4A 4AB • have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and RSM UK Audit LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006. • have been prepared in accordance with the requirements of the Charities Act 2011.

27 Consolidated statement of financial activities for year ended 31 December 2015 Restated Unrestricted funds Restricted funds 2015 Total 2014 Total General Designated Note 29 Note Funds Funds £000 £000 £000 £000 £000 Income and endowments from: Donations and legacies 2 10 71 141 222 237 Other trading activities 4 661 - - 661 493 Investment income 3 1,700 8 780 2,488 3,140 Charitable activities Membership 3,692 9 - 3,701 3,612 Chemistry World 1,190 - - 1,190 1,072 Scientific conferences and events 976 688 - 1,664 1,395 Education and professional practice 143 - 620 763 505 Publishing 42,589 - 543 43,132 40,736 Advocacy and awareness 114 - - 114 900 Other income 54 - - 54 1 Total income and endowments 51,129 776 2,084 53,989 52,091

Expenditure on: Raising funds Donations and legacies 446 - 9 455 436 Other trading activities 353 - - 353 445 Investment management osts 162 - 18 180 71 Charitable activities Membership 4,211 - 518 4,729 4,458 Chemistry World 2,562 - - 2,562 2,091 Scientific conferences and events 3,066 1,099 - 4,165 4,647 Education and professional practice 6,573 - 661 7,234 5,182 Publishing 35,627 - 439 36,066 33,698 Advocacy and awareness 4,362 - - 4,362 4,806 Total expenditure 7 57,362 1,099 1,645 60,106 55,834 Gains on investment assets 14 493 - 288 781 5,759 Net (expenditure)/income (5,740) (323) 727 (5,336) 2,016 Transfer between funds 23 (335) 335 - - - Net group (expenditure)/income before (6,075) 12 727 (5,336) 2,016 other recognised gains and losses

Remeasurement on Defined Benefit 10 7,903 - - 7,903 (22,677) Pension scheme

Net movement in funds 1,828 12 727 2,567 (20,661)

Reconciliation of funds

Fund balances brought forward 50,852 1,968 24,155 76,975 97,636 Fund balances carried forward 52,680 1,980 24,882 79,542 76,975

The notes on pages 32-59 form an integral part of these Financial Statements. All activities in 2015 are continuing. The 2014 Consolidated statement of financial activities is given in note 28.

28 Consolidated balance sheet as at 31 December 2015 Restated 2015 2014 Note £000 £000

Fixed assets Intangible assets 12 1,717 1,929 Tangible assets 13 9,704 10,889 Investments 14 82,606 88,826 94,027 101,644

Current assets Stock - books and paper 617 888 Debtors 15 15,650 13,353 Cash at bank and in hand 14,173 13,296 30,440 27,537

Current liabilities Creditors 16 5,469 5,655 Deferred income Journal and membership subscriptions 17 21,877 20,989 27,346 26,644

Net current assets 3,094 893

Total assets less current liabilities 97,121 102,537

Net assets excluding pension liability 97,121 102,537

Defined benefit pension liability 10 (17,579) (25,562)

Net assets including pension liability 18 79,542 76,975

Accumulated funds Unrestricted funds: General funds 23 70,133 79,861 Funds retained within non-charitable subsidiaries 23 126 (3,447) Pension reserve 10, 23 (17,579) (25,562) Designated funds 23 1,980 1,968 54,660 52,820 Restricted funds 22 24,882 24,155 Total charity funds 79,542 76,975

Approved by Council and authorised for issue on 28 April 2016

Professor Dominic Tildesley CBE FRSC, President The notes on pages 32-59 form an integral part of the Financial Statements.

29 Royal Society of Chemistry Balance sheet as at 31 December 2015 Restated 2015 2014 Note £000 £000

Fixed assets Intangible assets 12 1,717 1,929 Tangible assets 13 9,652 10,827 Investments 14 82,606 88,826 93,975 101,582

Current assets Stock - books and paper 617 888 Debtors 15 15,664 17,244 Cash at bank and in hand 13,386 12,293 29,667 30,425

Current liabilities Creditors 16 4,944 4,732 Deferred income Journal and membership subscriptions 17 21,776 20,977 26,720 25,709

Net Current assets 2,947 4,716

Total assets less current liabilities 96,922 106,298

Net assets excluding pension liability 96,922 106,298

Defined benefit pension liability 10 (17,579) (25,562)

Net assets including pension liability 18 79,343 80,736

Accumulated funds Unrestricted funds: General funds 23 70,133 80,175 Designated funds 23 1,980 1,968 Pension reserve 10, 23 (17,579) (25,562) 54,534 56,581 Restricted funds 22 24,809 24,155 Total charity funds 79,343 80,736

Approved by Council and authorised for issue on 28 April 2016

Professor Dominic Tildesley CBE FRSC, President The notes on pages 32-59 form an integral part of the Financial Statements.

30 Consolidated and charity statement of cash flows for year ended 31 December 2015

Group 2015 Group 2014 Charity 2015 Charity 2014

Note £000 £000 £000 £000

Net cash outflow from operating activities (6,964) (6,926) (6,754) (6,785)

Cash flows from investing activities:

Investment income received 3 2,488 3,140 2,488 3,140

Purchase of intangible fixed assets 12 (483) (700) (483) (700)

Purchase of tangible fixed assets 13 (1,001) (2,946) (985) (2,925)

Purchase of investments 14 - - - -

Net movements on cash held for investment 14 1 (1) 1 (1)

Proceeds from sale of investments 14 7,000 - 7,000 -

Net cash inflow/(outflow) from investing activities 8,005 (507) 8,021 (486)

Net cash inflow/(outflow) from financing activities - - - -

Increase/(decrease) in cash and cash equivalents 1,041 (7,433) 1,267 (7,271)

Cash and cash equivalents at the beginning of the reporting period 13,296 19,975 12,293 18,820

Change in cash and cash equivalents due to exchange rate movements (164) 754 (174) 744

Cash and cash equivalents at the end of the reporting period 14,173 13,296 13,386 12,293

Reconciliation of net (expenditure)/income to net cash outflow from operating activities

2015 2014 2015 2014

£000 £000 £000 £000

Net (expenditure)/income for the reporting period (5,336) 2,016 (9,296) 2,244

Adjustments for:

Depreciation and amortisation 2,881 2,714 2,855 2,577

Loss on disposal of fixed assets - 5 - 5

(Gains) on investments (781) (5,759) (781) (5,759)

Investment income (Note 3) (2,488) (3,140) (2,488) (3,140)

Investment income reinvested - - - -

Decrease/(increase) in stock 271 (132) 271 (132)

(Increase)/decrease in debtors (2,297) 1,884 1,580 1,084

(Decrease)/increase in creditors and accruals (186) 50 212 890

Increase/(decrease) in deferred income 888 (3,000) 799 (3,000)

Exchange rate movements on cash and cash equivalents 164 (754) 174 (744)

Defined benefit pension payments (958) (958) (958) (958)

Pension cost 878 148 878 148

Net cash outflow from operating activities (6,964) (6,926) (6,754) (6,785)

The notes on pages 32-59 form an integral part of the Financial statements.

31 RSC Worldwide (US), RSC (Beijing) Chemical and Science Notes to the financial Technology Consulting Co. Ltd., Royal Chemistry India Private Limited and Royal Society of Chemistry Japan K.K. statements are wholly owned subsidiaries of RSC Worldwide Limited. Royal Chemistry India Foundation is a wholly owned subsidiary of Royal Chemistry India Private Limited. Both 1 Accounting policies companies have a reporting date of 31 March. Accounting convention 33% of the shares in Chemistry Innovation Limited The financial statements have been prepared under are owned by the Institution of Chemical Engineers the historical cost convention modified to include (IChemE). The minority interest of the IChemE is shown certain financial instruments at fair value. The financial in note 21 of the Financial Statements. During the year, statements have been prepared in accordance with the company changed its reporting period to 30 June. the Statement of Recommended Practice: Accounting and Reporting by Charities preparing their accounts Friends of the RSC, Inc. is registered in the U.S. and is in accordance with the Financial Reporting Standard not a wholly owned subsidiary but the Society controls applicable in the UK and Republic of Ireland (FRS 102) the entity through common directors and as such the effective 1 January 2015, Financial Reporting Standard company has been included in the consolidated applicable in the United Kingdom and Republic of Ireland financial statements. The company has a reporting date (FRS 102) and the Charities Act 2011. These financial of 30 November. statements for the year ended 31 December 2015 are the first consolidated financial statements of the Society to The Divisional Regions, Local Sections, Interest Groups adopt FRS 102. The date of transition is 1 January 2014. and Benevolent Fund are separately constituted by Trust Deeds. Their results and net assets are accounted as The accounts (financial statements) have been prepared branches in these Financial Statements. to give a ‘true and fair’ view and have departed from the Charities (Accounts and Reports) Regulations 2008 General funds only to the extent required to provide a ‘true and fair The General funds mainly represent undesignated view’. This departure has involved following Accounting monies earned from publishing activities that are held in and Reporting by Charities preparing their accounts the form of investments. The funds are managed in order in accordance with the Financial Reporting Standard to maintain the Society’s investment income stream and applicable in the UK and Republic of Ireland (FRS 102) thus help finance the cost of the Society’s charitable issued on 16 July 2014 rather than the Accounting and activities. Reporting by Charities: Statement of Recommended Practice effective from 1 April 2005 which has since been Designated funds withdrawn. The Designated funds relate to the large number of In preparing the accounts, a restatement of comparative member led groups which allow the wider community items was needed for applying the accounting policies to connect with fellow chemists based on either required by FRS 102 and the Charities SORP FRS 102. geographical location or subject interest. The An explanation of how the transition has affected the geographical network consists of 35 local sections in reported financial position and financial performance is the UK and Ireland and 23 sections based outside the given in note 29. UK. Divisions and Interest Groups are subject specific covering the breadth of the chemical sciences research, The Royal Society of Chemistry meets the definition of a education, innovation and policy. The groups are run by public entity under FRS 102. members and organise annual programmes of events, award portfolios and bursaries. The going concern basis of accounting is considered to be appropriate because there are no material The income within the designated funds is taken and uncertainties related to events or conditions that may held directly by the Interest Groups and used solely for cast significant doubt about the ability of the Society to the purposes of that group. As such it is classified as continue as a going concern. designated fund income and not recognised as general fund income. Basis of consolidation Restricted funds The consolidated statement of financial activities and the consolidated balance sheet include the financial The Society’s restricted funds are the Benevolent Fund, statements of the charity and its subsidiaries consolidated trust funds, restricted grants, Royal Chemistry India on a line by line basis. Intra-group transactions and Foundation and Friends of the RSC, Inc. profits are eliminated fully on consolidation. Accounting policies are consistent across the group.

Chemistry Limited and RSC Worldwide Limited are wholly owned subsidiaries of the RSC.

32 The Benevolent Fund provides financial and non- Voluntary income financial assistance to the Society’s members. Voluntary income, including legacies, is recognised in the SoFA when any conditions for receipt have been met The various trust funds are restricted to specific aspects and when the entitlement is probable and measurable. of the Society’s activities. The income of the various trust Amounts included are net of any legal or other fees paid, funds finances lectureships, awards, prizes, and research or payable, in connection with the income. grants. Investment income The restricted grants are restricted to specific projects by the donors that further the Society’s charitable activities. Investment income is recognised on an accruals basis Income is recognised when the Society is entitled to the and apportioned between funds on the basis of the level grant, which is usually when the grant is received, except of funds invested. for performance related grants: revenue for these is recognised when a specified output is achieved. Life membership Life membership subscriptions are accounted for on a Royal Chemistry India Foundation is a charitable received basis. In 2015 these subscriptions amounted to foundation, registered in Delhi, India; its primary purpose £7K relating to 14 members (2014: £2K, 6 members). is to deliver educational programmes in chemistry within India, including teacher training and student outreach Intangible income camps. No value has been placed on the support given to the Friends of the RSC, Inc. is a U.S. private foundation which Society by way of volunteer assistance. The Society has was incorporated to offer a tax efficient way for US not received any other intangible income or gifts in kind. citizens to make donations to support scientific research and projects at educational institutions in the United Resources expended Kingdom. All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate Revenue recognition all costs related to the category. Where costs cannot Revenue is measured at the fair value of the consideration be directly attributed to a particular heading they have received or receivable. The fair value of the consideration been allocated to activities on a basis consistent with the received or receivable takes into account the amount of use of resource. Governance costs include expenditure any trade discounts, prompt settlement discounts and on compliance with constitutional and statutory volume rebates. Revenue is shown requirements. net of Value Added Tax. Costs of raising funds include investment management Revenue from publishing activities is recognised in two fees and corporate fundraising costs. Fundraising costs separate ways, dependent on the specific product: include the salaries and overheads of the staff who directly undertake fundraising activities plus allocated • Revenue for the sales of institutional subscriptions, support costs. package subscriptions and consortium deals, is recognised in equal monthly proportions during the Apportionment of support costs subscription year. Support costs are all apportioned on the basis of head count for each of the departments. • Revenue for the sales of journal archive and eBooks is recognised when access to the product is passed to Grants the customer. Grants made by the Benevolent Fund are treated as Conference income outgoing resources as soon as they are approved by the Benevolent Fund Grants Committee as there is an Revenue for conferences is recognised in the year of expectation of receipt by the Beneficiary. Other grants the event. made from Designated Funds represent grants made to Local, Regional and Interest Groups, which are treated on Deferred Income a cash payment basis. Income received in the year or invoiced in advance for journal and membership subscriptions relating to the following year is shown as deferred income in the balance sheet. The income is treated as income in the year the subscription covers.

Conference income received in advance is deferred and treated as income in the year the respective conference is held.

33 Leases Investment in subsidiary undertakings Rentals under operating leases are charged to the SoFA Investments in subsidiary undertakings are stated at on a straight-line basis over the lease term allocated to cost, but are written down to their realisable value if it is the charitable activities. considered that there has been a permanent diminution in their value. Taxation The Royal Society of Chemistry is registered as a charity Stocks (Charity Commission reference 207890) and as such Stocks are valued at the lower of cost and net realisable the income arising from and expended on its charitable value and include publications and paper stocks. activities is exempt from corporation tax. It is also registered for Value Added Tax with HM Revenue and Heritage assets Customs and is subject to partial exemption rules. Any irrecoverable VAT is either included in fixed asset costs or No valuation is attributable to the library or other historic in support costs that are then allocated to the charitable material in the Financial statements. The Trustees believe activities as applicable. that an accurate valuation of the historic collection is not possible. The Society was founded in 1841 and the Intangible fixed assets library collection has been built over time to contain a large number of unique and irreplaceable historical items. Intangible assets are capitalised at cost, including any Therefore due to the number of books held and the lack directly attributable costs. These are currently amortised of comparable market values these assets have not been on a straight-line basis over a five year period, which is recognised on the balance sheet as any value attributed the useful economic life of the asset. A full impairment to these assets would be purely subjective and of limited review is carried out in the year of acquisition with practical use. consideration given in subsequent years to whether any indicator of impairment exists. Recognition of liabilities Amortisation of the index and databases are charged Liabilities are recognised when an obligation arises to to Publishing activities. The web platform is used for transfer economic benefit as a result of past transactions activities across the whole organisation and therefore or events. amortisation is apportioned across all charitable activities. Pensions Tangible fixed assets and depreciation The Society has two types of pension scheme: Items of a capital nature are capitalised at cost if their individual purchase price or the project price exceeds Defined contribution plan £1,000. Purchased software is capitalised at cost. The Society operates a defined contribution scheme. The Depreciation is charged on a straight-line basis. Society’s contributions are charged to the SoFA’s General The main depreciation rates are as follows: funds during the period in which the employee is an active member of the scheme. The cost of administering Leasehold land and buildings: the scheme and providing for death in service are met by the Society. Thomas Graham House 2% Burlington House 5% Defined benefit plan The Society operates a defined benefit pension scheme. Fixtures, fittings and equipment: The defined benefit plan closed to new entrants on 31 Computer software 20%–33% December 2002 and was closed to future accrual on 30 November 2011. Personal computers 25% The pension liability recognised in the balance sheet is Other computer hardware 20% the obligation of the Society, being the present value of Other furniture 20%–25% its defined benefit obligation at the reporting date minus Fixed Assets are written down to their realisable value the fair value at the reporting date of plan assets out of if it is considered that there has been a permanent which the obligations are to be settled. diminution in their value. Assets are reviewed annually for The pension costs for the scheme are recognised as impairment. follows: (i) the change in the net defined benefit liability arising from employee service rendered during the Investments reporting period in the SoFA; (ii) net interest on the Quoted investments are stated at market value at the net defined benefit liability during the reporting period balance sheet date. Account is therefore taken of both in the SoFA; (iii) the cost of plan introductions benefit realised and unrealised gains in the SoFA. Investment changes, curtailments and settlements in the SoFA; (iv) income is stated on an accruals basis. remeasurement of the net defined benefit liability in

34 other recognised gains or losses on the SoFA. The net The balance sheet values of subsidiaries have been interest element is determined by multiplying the net translated at the closing rate on 31 December 2015. The defined benefit liability by the discount rate, at the start profit and loss transactions have been translated at the of the period taking into account any changes in the net rate of exchange ruling at the date of transaction or at an defined benefit liability during the period as a result of exchange rate that approximates the actual rate. contribution and benefit payments. The net interest is recognised in the SoFA as other revenue or apportioned Cash at cash equivalents in expenditure. Cash at bank and cash in hand includes cash and short Remeasurement of the net defined benefit liability term highly liquid investments with a short maturity of comprises: (i) actuarial gains and losses; and (ii) the three months or less from the date of acquisition or return on plan assets, excluding amounts included opening of the deposit or similar account. in net interest on the net defined benefit liability. Remeasurement of the net defined benefit liability Key judgements and assumptions recognised in other gains or losses on the SoFA shall not The cost of the defined benefit pension plan has been be reclassified to profit or loss in a subsequent period. determined by updating the results of the 31 December 2013 full actuarial valuation to 31 December 2015. This Government grants was carried out by a qualified actuary independent of Income from government and other grants, whether the Society. The actuarial valuation involves making ‘capital’ grants or ‘revenue’ grants, is recognised when assumptions about discount rates, future salary increases, the charity has entitlement to the funds, any performance mortality rates and future pension increases. Due to the conditions attached to the grants have been met, it complexity of the valuation, the underlying assumptions is probable that the income will be received and the and the long term nature of the scheme, such estimates amount can be measured reliably and is not deferred. are subject to significant uncertainty. In determining the appropriate discount rate, the management considers Derivative instruments the market yields of AA corporate bonds consistent with the currency and term of the defined benefit obligation. The Society uses forward foreign currency contracts to The mortality rate is based on publicly available mortality reduce exposure to foreign exchange rates. Derivative tables, which uses data for UK self-administered pension financial instruments, are initially measured at fair value schemes and allowing for expected future improvements on the date on which a derivative contract is entered in longevity. Future salary increases and pension into and are subsequently measured at fair value through increases are based on expected future inflation rates profit or loss. Derivatives are carried as assets when the as determined by the Bank of England spot rate with a fair value is positive and as liabilities when the fair value is consistent term of the defined benefit obligation at the negative. The fair value of the forward currency contracts valuation date. Further details are given in Note 10. is calculated by reference to current forward exchange contracts with similar maturity profiles.

Financial assets and liabilities Basic financial instruments, which comprise trade debtors and creditors, bonds and similar debt instruments are initially recognised at transaction value and subsequently measured at their settlement value. Complex financial instruments which do not qualify as basic and quoted investments are measured at fair value through profit or loss.

Benevolent Fund house nomination rights The Benevolent Fund has four contracts that allow it to nominate occupation of 22 units of sheltered housing. In accordance with FRS 102, the value is held as zero as these rights have no realisable value.

Foreign currency Monetary assets and liabilities in foreign currencies are translated into sterling at the rate of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction or at an exchange rate that approximates the actual rate. Exchange differences are taken into account in arriving at the operating result. Forward exchange contracts are used to manage the exposure to foreign exchange rate risks related to US dollar and euro income and cash balances.

35 2 Donations and legacies

2015 2014 General Designated Restricted funds funds funds Total Total £000 £000 £000 £000 £000 Donations 10 71 40 121 152 Bequests and Legacies - - 101 101 85 10 71 141 222 237

3 Investment income

2015 2014 General Designated Restricted funds funds funds Total Total £000 £000 £000 £000 £000

Assets in the UK Fixed Interest 907 - 572 1,479 2,157 Unit Trusts 322 - 67 389 396 Equities 99 - - 99 - Interest 19 8 27 54 60 Assets outside the UK Fixed Interest 172 - 69 241 217 Equities 181 - 45 226 310 1,700 8 780 2,488 3,140

4 Income from other trading activities

Income from other trading activities consists entirely of turnover from Chemistry Limited, a wholly owned trading subsidiary of the Society. Its principal activity is to promote Burlington House as a unique venue for both chemistry and non-chemistry related events and to carry out any non-primary purpose trading on behalf of the RSC. All the profit from the trading subsidiary is passed to the charity under the gift aid scheme.

5 Government grants

The Society receives grant funding from national and international governmental bodies. In 2015 £244K of government funding was recognised in the statement of financial activities (2014:£864k) for education related and teaching training programmes and for chemical database services. Funds have been used for the Society’s Initial Teacher Training scholarship scheme, which offers tax-free funding and packages of support to individuals who want to become exceptional chemistry teachers. Funding has also been used for the continuation of the Society’s National Chemical Database service, which brings together tools and resources for UK researchers in chemistry and related fields.

36 6 Total staff costs

2015 2014 £000 £000 Staff costs were: Gross wages and salaries 20,690 19,139 National insurance 2,254 2,009 Pension and related cost 1,729 1,565 Temporary staff and contractors 96 125 Total 24,769 22,838

The number of employees who earned more than £60K (including taxable benefits in kind) during the year is shown below.

Number of Employees 2015 2014 Employee earnings:

£60,000–£69,999 11 9

£70,000–£79,999 5 8

£80,000–£89,999 6 2

£90,000–£99,999 4 2

£100,000–£109,999 - 3

£120,000–£129,999 1 1

£130,000–£139,999 1 -

£140,000–£149,999 1 -

£170,000–£179,000 1 1

The number of employees who earned more than £60k, for whom pension benefits are accruing under the defined contribution scheme is 22 (2014: 25). The employer contributions made to the defined contribution pension scheme for employees who earned more than £60K were £205k (2014: £225k). In 2015 the Society paid a total of £58k (2014: £116k) in respect of statutory and other employment severance-related payments. The key management personnel of the Society comprises the Trustees and the Leadership Team. Key management personnel are in charge of directing and controlling the charity and running and operating the charity on a day to day basis. All Trustees give their time freely and no Trustee remuneration was paid in the year. Details of Trustee expenses and related party transactions are disclosed in Note 26 to the accounts. Total employee benefits of £1,006k (2014: £992k) were paid to the Society’s Leadership Team personnel in 2015.

Average monthly number of employees 2015 2014

Membership 36 40 Chemistry World 17 15 Scientific conferences and events 10 11 Education and professional practice 50 37 Publishing 306 278 Advocacy and awareness 25 41 Support 136 134 Fundraising 4 3 Total 584 559

37 7 Total resources expended

General funds Direct staff Direct Support Total Total costs costs costs 2015 2014 £000 £000 £000 £000 £000

Expenditure on raising funds Donations and legacies 234 73 139 446 434 Other trading activities - 349 4 353 445 Investment management costs - 162 - 162 47

Total 234 584 143 961 926

Charitable activities Membership 1,406 1,396 1,409 4,211 3,980 Chemistry World 767 1,123 672 2,562 2,091 Scientific conferences and events 530 2,128 408 3,066 3,356 Education and professional practice 1,837 3,171 1,565 6,573 4,813 Publishing 11,761 13,298 10,568 35,627 33,369 Advocacy and awareness 1,314 2,042 1,006 4,362 4,806

Sub total 17,615 23,158 15,628 56,401 52,415

Total resources expended 17,849 23,742 15,771 57,362 53,341

Total direct costs include foreign exchange loss of £368k (2014: £657k), which is charged to publishing. Direct costs also include an increase to the stock provision of £382k (2014: £37k) and cost of sales for stock of £374k (2014: £456k). Stock related costs are also charged to publishing.

Designated funds Direct Staff Direct Support Total Total costs costs costs 2015 2014 £000 £000 £000 £000 £000

Charitable activities Scientific conferences and events - 1,099 - 1,099 1,231 Total - 1,099 - 1,099 1,231

Restricted funds Direct Staff Direct Support Total Total costs costs costs 2015 2014 £000 £000 £000 £000 £000

Cost of generating funds Donations and legacies - 9 - 9 2 Investment management costs - 18 - 18 24

Total - 27 - 27 26

Charitable activities Membership 109 409 - 518 478 Scientific conferences and events - - - 61 Education and professional practice 6 655 - 661 369 Publishing - 439 - 439 328 Sub total 115 1,503 - 1,618 1,236

Total 115 1,530 - 1,645 1,262

38 8 Support costs – General fund

2015 2014 Management Finance Information Comms Human Accomm. Governance Total Total technology resources £000 £000 £000 £000 £’000 £000 £000 £000 £000

Basis of Allocation Head Head Head Head Head Head Head count count count count count count count Donations and legacies 8 17 43 11 28 29 3 139 108 Other trading activities ------4 4 4 Membership 84 178 432 112 281 290 32 1,409 1,313 Chemistry World 40 86 206 53 134 138 15 672 498 Scientific conferences and events 24 51 123 32 81 83 14 408 360 Education and professional practice 93 197 479 124 312 321 39 1,565 1,219 Publishing 630 1,338 3,240 835 2,109 2,169 247 10,568 9,170 Advocacy and awareness 59 127 306 79 199 205 31 1,006 1,128 Total 938 1,994 4,829 1,246 3,144 3,235 385 15,771 13,800

9 Governance costs

2015 2014 £000 £000

Trustee expenses Note 26 78 61 Legal fees 11 1 Audit and accounting fees 126 61 Support staff costs 170 155 Total 385 278

Analysis of auditors’ remuneration 2015 2014 £000 £000

Fees payable to: - RSM UK Audit LLP for audit of the RSC and consolidated accounts 37 36 - RSM Tax and Accounting Limited for tax advisory services 57 7 - Auditors other than RSM UK Audit LLP 32 18 Total 126 61

39 10 Pension fund

Group and Society The most recent actuarial valuation showed a deficit of The Society operates a defined benefit scheme in the £9,415,000. The society has agreed with the trustees that UK. This is a separate trustee administered fund holding it will aim to eliminate the deficit by annual payments of the pension scheme assets to meet long term pension £958,000 from 1 January 2015, increasing each year by liabilities. A full actuarial valuation was carried out at 3%, until 28 February 2023. 31 December 2013 and updated to 31 December 2015 The Society also operates a defined contribution scheme. by a qualified actuary, independent of the scheme’s The contributions are administered by investment sponsoring employer. The major assumptions used by managers on behalf of the employees. The cost for the the actuary are shown in this note. year to the employer was £1,625K (2014; £1,459K).

Employee benefit obligations Value at Value at 31/12/15 31/12/14 £000 £000

Present value of funded obligations 112,398 119,207 Fair value of scheme assets (94,819) (93,645) 17,579 25,562 Deficit 17,579 25,562 Net liability 17,579 25,562

Statement of financial activities impact Value at Value at 31/12/15 31/12/14 £000 £000

Expenses - (3) Net interest cost (878) (145) Total expense (878) (148)

Amount recognised in the Statement of financial activities after net/(outgoing) incoming resources Value at Value at 31/12/15 31/12/14 £000 £000

Net actuarial gains/(losses) recognised in year 7,903 (22,677) Net cumulative actuarial losses (11,351) (19,254)

40 10 Pension fund (continued)

Reconciliation of fair value of the defined benefit obligation and fair value of plan assets Value at Value at 31/12/15 31/12/14 £000 £000

Change in the present value of the defined benefit obligation: Opening defined benefit obligation 119,207 93,097 Expenses - 3

Interest expense 4,118 4,132 Actuarial losses (7,816) 24,538 Benefits paid (3,111) (2,563) Closing defined benefit obligation 112,398 119,207

Change in the fair value of plan assets: Opening fair value of plan assets 93,645 89,402 Interest income 3,240 3,987 Actuarial gains 87 1,861

Contributions by employer 958 958 Benefits paid (3,111) (2,563) Closing fair value of plan assets 94,819 93,645

Principal actuarial assumptions at the balance sheet date At At 31/12/15 31/12/14 % %

Rate of discount 3.90 3.50

Inflation (RPI) 3.35 3.10

Inflation (CPI) 2.35 2.10

Salary increases 4.00 4.00

Allowance for revaluation of deferred pensions of CPI or 5% p.a. if less 2.35 2.10

Allowance for pension in payment increases of RPI or 5% p.a. if less 3.25 3.00

Allowance for pension in payment increases of RPI or 3.5% p.a. if less 2.95 2.70

Allowance for commutation of pension for cash at retirement 90% of post a day 90% of post a day

The mortality assumptions adopted at 31 December 2015 imply the following life expectancies:

Life expectancy at age 60 Life expectancy at age 60 (years) (years) At At 31/12/15 31/12/14 Male retiring in 2015 (2014) 27.7 27.8 Female retiring in 2015 (2014) 29.8 30.2 Male retiring in 2035 (2034) 29.6 29.8 Female retiring in 2035 (2034) 31.8 32.2

Assets in the plan as a percentage of total plan assets

At At 31/12/15 31/12/14 Equities and diversified growth funds 62% 60% Bonds 37% 38% Cash 1% 2%

41 10 Pension fund (continued)

2015 2014 £000 £000

Actual return on plan assets 3,327 5,848

Movement in net liability during the year 2015 2014 £000 £000

Net liability at beginning of the year 25,562 3,695 Movement in year Employer’s expenses - 3 Employer’s contributions (958) (958) Interest income (3,240) (3,987) Actuarial gains (87) (1,861) Interest on pension liabilities 4,118 4,132 Experience losses/(gains) arising on the plan liabilities (18) 1,119 Changes in assumptions underlying the plan liabilities (7,798) 23,419

Total movement (7,903) 21,867

Deficit in plan at end of the year 17,579 25,562

Defined contribution scheme

2015 2014 £000 £000

Employer contributions 1,625 1,459

11 Operating leases

Charges under operating leases to the Statement of financial activities during the year was £36k (2014: £115k). The basis of this disclosure has changed due to FRS 102, which now requires disclosure for the total of the future minimum lease payments for each of the following periods below. At 31 December the Group was committed to making the following payments for each of the following periods:

2015 2014 £000 £000 Leases payments: Within a year 54 52 Within two to five years 27 28 Later than five years 1,100 1,103 1,181 1,183

The Society, along with the four other courtyard societies, continues to be in negotiation with the landlord on the renewal of the lease of Burlington House.

42 12 Intangible fixed assets

Group Index & databases Web platform Total £000 £000 £000 Cost Balance at 1 January 2015 1,737 2,810 4,547 Additions - 483 483 Balance at 31 December 2015 1,737 3,293 5,030 Accumulated amortisation Balance at 1 January 2015 1,260 1,358 2,618 Charge for year 140 555 695 Balance at 31 December 2015 1,400 1,913 3,313 Net book value at 31 December 2015 337 1,380 1,717 Net book value at 31 December 2014 477 1,452 1,929

Society Index E-Platform Total £000 £000 £000 Cost Balance at 1 January 2015 695 2,810 3,505 Additions - 483 483 Balance at 31 December 2015 695 3,293 3,988 Accumulated amortisation Balance at 1 January 2015 218 1,358 1,576 Charge for year 140 555 695 Balance at 31 December 2015 358 1,913 2,271 Net book value at 31 December 2015 337 1,380 1,717 Net book value at 31 December 2014 477 1,452 1,929

The intangible asset index relates to the intellectual property rights of the Merck Index acquired for $750k by the RSC during 2012. The intangible asset database relates to ChemSpider owned by RSC Worldwide Limited and MarinLit owned by the RSC. RSC Worldwide Limited is a wholly owned subsidiary of the Royal Society of Chemistry. The web platform provides access to RSC online purchases of journal articles, books, CPD courses and other ecommerce purchases and is owned by the RSC.

43 13 Tangible fixed assets

Group Leasehold land Fixtures, fittings Total and buildings and equipment

£000 £000 £000 Cost Balance at 1 January 2015 8,473 14,860 23,333 Additions 2 999 1,001 Disposals (3) (1,912) (1,915) Balance at 31 December 2015 8,472 13,947 22,419 Accumulated depreciation Balance at 1 January 2015 4,263 8,181 12,444 Disposals (3) (1,912) (1,915) Charge for year 272 1,914 2,186 Balance at 31 December 2015 4,532 8,183 12,715 Net book value at 31 December 2015 3,940 5,764 9,704 Net book value at 31 December 2014 4,210 6,679 10,889

Society Leasehold Land Fixtures, fittings Total and buildings and equipment

£000 £000 £000 Cost Balance at 1 January 2015 8,473 14,603 23,076 Additions - 985 985 Disposals (3) (1,912) (1,915) Balance at 31 December 2015 8,470 13,676 22,146 Accumulated depreciation Balance at 1 January 2015 4,284 7,965 12,249 Disposals (3) (1,912) (1,915) Charge for year 272 1,888 2,160 Balance at 31 December 2015 4,553 7,941 12,494 Net book value at 31 December 2015 3,917 5,735 9,652 Net book value at 31 December 2014 4,189 6,638 10,827

Heritage assets

As one of the foremost chemical societies in the world, the RSC is the guardian of an extensive historical collection of over 3,500 books, the oldest of which dates back to 1505, and over 2,000 journals. The collection is primarily composed of materials from the Chemical Society, further augmented by the collections of other societies and further added to by donations, bequests and loans.

The library provides access to items of interest to walk-in visitors, whilst other, older and more valuable items are kept securely elsewhere throughout Burlington House. Many of the items within the collection are irreplaceable originals to which no reliable value can be attributed.

Accordingly, these assets are not capitalised in the financial statements. The Trustees take the view that any further and detailed particulars of the numerous items making up this collection would unduly clutter the accounts and thus detract from their primary purpose.

Due to the importance of the collection the RSC has a policy to not dispose of any items held within it.

There were no disposals and 12 new additions to the collection during 2015. All additions in the period were donated to the collection.

44 14 Fixed asset investments

Group and Society

2015 2014

General Restricted Total Total funds funds funds funds £000 £000 £000 £000 Investments listed on recognised stock exchange in the UK Fixed interest 21,894 11,982 33,876 36,873 Equities 11,670 - 11,670 - Unit trusts 9,311 1,964 11,275 10,233

Investments listed on recognised stock exchange outside the UK Fixed interest 2,021 815 2,836 6,006 Equities 19,801 2,775 22,576 34,579 Property - - - 140

Total investments listed on recognised stock exchange 64,697 17,536 82,233 87,831 Cash held for investment 141 232 373 682 Liquid assets within funds - - - 313 Total investments 64,838 17,768 82,606 88,826

2015 2014

General Restricted Total Total funds funds funds funds

£000 £000 £000 £000 Market value at 1 January 71,345 17,481 88,826 83,066 Less: disposal proceeds including share exchanges (24,776) (2,450) (27,226) - Add: purchases at cost including share exchanges 17,776 2,450 20,226 - Realised and unrealised gains 493 288 781 5,759 Net movements on cash held for investment - (1) (1) 1 Market value at 31 December 64,838 17,768 82,606 88,826

During the year the Society transferred £20m between different investments managed through an external investment advisor. This did not impact the cash flow of the Society and therefore these transfers have been excluded from the cash flow statement. During 2015 the Society withdrew £7m (2014:nil) from investments to fund operating activities and this has been included within the cash flow statement. The historical cost of investments held at fair value as at 31 December 2015 is £70,363k (2014: £70,727k).

Material investments which represent greater than 5% of total fixed asset investments by market value included above are as follows:

2015 2014 £000 £000

BlackRock UK Fixed Interest Corporate Bonds 7,835 13,600 Royal London Asset Management Corporate Bonds 8,483 6,006 Royal London Asset Management Sterling Extra Yield Bond Fund 9,108 8,763 Sarasin & Partners Equisar Global Thematic Fund - 14,509 Schroder QEP Global Active Fund 10,959 11,684 Schroder Exempt Property Units 11,275 12,204 Kames Global Equity Income Fund 10,486 10,233 Newton Real Return Exempt Fund (Inc) 11,670 9,762 Payden Absolute Return Bond Fund 8,451 -

45 15 Debtors

Group 2015 2014 £000 £000 Trade debtors 12,213 10,029 Other debtors 1,434 715 Prepayments and accrued income 2,003 2,609 15,650 13,353

Included in other debtors for 2015 is £68k (2014: £65k) in relation to programme related Investments.

Society 2015 2014 £000 £000 Trade debtors 11,866 9,745 Other debtors 1,242 604 Amounts due from group undertakings 643 4,822 Prepayments and accrued income 1,913 2,073 15,664 17,244

Included in other debtors for 2015 is £68k (2014: £65k) in relation to programme related investments. The amounts due from group undertakings previously included a loan to RSC Worldwide Limited by the RSC, which was subject to interest charged at LIBOR plus 2%. The loan balance at 31 December 2014 was £3,960k and was fully repaid in 2015.

16 Creditors

Amounts falling due within one year Group 2015 2014 £000 £000

Trade creditors 798 790 Other creditors 332 761 Derivatives 385 754 Taxes 64 9 Accruals 3,890 3,341 5,469 5,655

Society 2015 2014 £000 £000

Trade creditors 777 725 Other creditors 215 152 Derivatives 385 754 Amounts due to group undertakings 28 - Accruals 3,539 3,101 4,944 4,732

46 17 Deferred income

Amounts falling due within one year Group 2015 2014 Journal subscriptions £000 £000 Balance at 1 January 19,644 22,701 Amounts released in year (19,644) (22,701) Amounts deferred in year 20,459 19,644 Balance at 31 December 20,459 19,644

Membership subscriptions £000 £000 Balance at 1 January 1,345 1,288 Amounts released in year (1,345) (1,288) Amounts deferred in year 1,418 1,345 Balance at 31 December 1,418 1,345

Total 21,877 20,989

Society 2015 2014 Journal subscriptions £000 £000 Balance at 1 January 19,632 22,689 Amounts released in year (19,632) (22,689) Amounts deferred in year 20,358 19,632 Balance at 31 December 20,358 19,632

Membership subscriptions £000 £000 Balance at 1 January 1,345 1,288 Amounts released in year (1,345) (1,288) Amounts deferred in year 1,418 1,345 Balance at 31 December 1,418 1,345

Total 21,776 20,977

47 18 Analysis of net assets between funds

Group General Designated Restricted Total funds funds funds £000 £000 £000 £000 Fund balances at 31 December 2015 are represented by: Tangible assets 9,704 - - 9,704 Intangible assets 1,717 - - 1,717 Investments 64,838 - 17,768 82,606 Net current assets/(liabilities) (6,000) 1,980 7,114 3,094 Pension liability (17,579) - - (17,579)

Total net assets 52,680 1,980 24,882 79,542

Society General Designated Restricted Total funds funds funds £000 £000 £000 £000 Fund balances at 31 December 2015 are represented by: Tangible assets 9,652 - - 9,652 Intangible assets 1,717 - - 1,717 Investments 64,838 - 17,768 82,606 Net current assets/(liabilities) (6,074) 1,980 7,041 2,947 Pension liability (17,579) - - (17,579)

Total net assets 52,554 1,980 24,809 79,343

19 Financial derivatives

Forward exchange contracts are used to manage exposure to currency exchange risk. Contracts to the value of US$19,050k and €375k were entered into during the year ended 31 December 2015 (2014: US$28,700k and €0k). Contracts totalling US $25,590k and €375k (2014: US$24,500k and €0k) matured during 2015. As at 31 December 2015 there were contracts totalling US $15,300k, which will mature in 2016.

Cumulative (losses)/gains on forward contracts 2015 2014 £000 £000

Cumulative (losses)/gains on forward contracts (444) 161

48 20 Financial assets and liabilities

Group 2015 2014 £000 £000

Financial assets measured at fair value through profit or loss 82,606 88,826 Financial assets measured at amortised cost 13,761 11,446 Financial liabilities measured at fair value through profit or loss (385) (754) Financial liabilities measured at amortised cost (4,867) (4,848)

Society 2015 2014 £000 £000

Financial assets measured at fair value through profit or loss 82,606 88,826 Financial assets measured at amortised cost 13,914 15,835 Financial liabilities measured at fair value through profit or loss (385) (754) Financial liabilities measured at amortised cost (4,407) (4,062)

Fixed asset investments are valued at quoted prices through the recognised stock exchange in the UK and outside the UK. The Society uses forward foreign currency contracts to reduce exposure to foreign exchange rates. The fair value of the forward currency contracts is calculated by reference to current forward exchange contracts with similar maturity profiles.

49 21 Investment in subsidiaries

Society Investment Capital and reserves £ £000 RSC Worldwide Limited* 100 (278) Chemistry Innovation Limited** 67 (15) RSC Worldwide (US) Inc*** 6,250 81 Chemistry Limited* 2 294 RSC (Beijing) Chemical and Science Technology Consulting Co., Ltd.*** 120,000 120 Royal Chemistry India Private Limited**** 157,272 200 Royal Society of Chemistry Japan K.K.*** 69,729 78 Royal Chemistry India Foundation***** 150 35 Friends of the RSC, Inc. - 38

* RSC owns 100% of the Issued Share Capital. ** RSC owns 67% of the Issued Share Capital. *** RSC Worldwide Limited owns 100% of the Issued Share Capital. **** RSC Worldwide Limited owns 99.99% of the Issued Share Capital. ***** Royal Chemistry India Private Limited owns 100% of the Issued Share Capital. The consolidated balance sheet incorporates the balance sheets of these subsidiary companies after elimination of the intercompany debtor and creditor balances due to and from the Society. The primary purpose of all subsidiaries with the exception of Chemistry Limited is to promote the RSC and its charitable objectives in different territories of the world. Chemistry Limited’s principal activity is to facilitate the non primary purpose trading of the RSC. 2015 profit and loss and balance sheet for the Society’s subsidiaries

Chemistry Innovation Limited RSC Worldwide Limited Chemistry Limited Registered No. 05952414 Registered No. 6702733 Registered No. 3801760 2015 2014 2015 2014 2015 2014 £000 £000 £000 £000 £000 £000

Profit and loss account Gross Income 49 869 7,206 3,281 532 493 Total expenditure (83) (869) (3,777) (3,317) (359) (472) Profit/(loss) (34) - 3,429 (36) 173 21

Balance sheet Aggregate assets 15 575 640 689 459 523 Aggregate liabilities (30) (556) (918) (4,396) (165) (381) Total funds (15) 19 (278) (3,707) 294 142

The Net Assets of Chemistry Innovation Limited include a minority interest of £6K in respect of the IChemE shareholding. This has not been recognised separately on the basis of materiality. The 2015 financial statements of Chemistry Innovation includes a matter of judgement and full disclosure in that regards is included in the financial statements of the company. The company has ceased activities in 2015 and the directors, along with the shareholders, have agreed to dissolve the company. The directors of RSC Worldwide Limited and Chemistry Limited have passed a resolution to pay any taxable profits made to the RSC under Gift Aid. During the year Royal Chemistry India Private Limited, a subsidiary of RSC Worldwide Limited, acquired a charitable subsidiary in India: Royal Chemistry India Foundation.

50 22 Restricted funds

Group Movement in funds Benevolent Trust Grant Friends of Royal Chemistry Total Fund fund income the RSC, Inc. India Foundation £000 £000 £000 £000 £000 £000 Balance at 1 January 2014 12,979 9,309 313 42 - 22, 643 Incoming resources 536 410 889 - - 1,835 Expenditure (153) (351) (757) (2) - (1,263) Gains on investment assets 505 435 - - - 940 Balance at 31 December 2014 13,867 9,803 445 40 - 24,155 Incoming resources 552 356 1,001 - 175 2,084 Expenditure (168) (368) (967) (2) (140) (1,645) Gains on investment assets 157 131 - - - 288 Balance at 31 December 2015 14,408 9,922 479 38 35 24,882

The 2014 opening and closing balances for Grant income has been restated. Details of the restatement are disclosed in Note 29.

Society Movement in funds

Benevolent Trust Grant Total Fund fund income

£000 £000 £000 £000 Balance at 1 January 2014 12,979 9,309 313 22,601 Incoming resources 536 410 889 1,835 Expenditure (153) (351) (757) (1,261) Gains on investment assets 505 435 - 940 Balance at 31 December 2014 13,867 9,803 445 24,115 Incoming resources 552 356 1,001 1,909 Expenditure (168) (368) (967) (1,503) Gains on investment assets 157 131 - 288 Balance at 31 December 2015 14,408 9,922 479 24,809

The RSC Benevolent Fund operates within a well defined strategy to provide a flexible range of financial and non-financial help to members and their dependants to relieve poverty. We have a network of 102 volunteers, predominantly in the UK. Some are actively involved in visiting existing or potential beneficiaries to help them with the application process. Others provide peer support, and are a local point of contact for isolated members of our community.

51 23 Unrestricted funds

General funds Group and Society Movement in funds

Funds retained within non-charitable Pension General funds subsidiaries reserve Total £000 £000 £000 £000 Balance at 1 January 2014 80,313 (3,575) (3,695) 73,043 Incoming resources 43,135 2,170 3,987 49,292 Expenditure (46,810) (2,396) (4,135) (53,341) Gains on investment assets 4,819 - - 4,819 Transfers (1,242) - 958 284 Actuarial gain - - (22,677) (22,677) Balance at 31 December 2014 80,215 (3,801) (25,562) 50,852 Incoming resources 38,323 9,566 3,240 51,129 Expenditure (47,605) (5,639) (4,118) (57,362) Gains on investment assets 493 - - 493 Transfers (1,293) - 958 (335) Actuarial gain - - 7,903 7,903 Balance at 31 December 2015 70,133 126 (17,579) 52,680

Designated funds Group and Society Movement in funds Subject Local Regional Total groups sections groups £000 £000 £000 £000 Balance at 1 January 2014 1,639 175 138 1,952 Incoming resources 808 86 69 963 Expenditure (915) (232) (84) (1,231) Transfers from general funds 144 135 5 284 Balance at 31 December 2014 1,676 164 128 1,968 Incoming resources 660 67 49 776 Expenditure (805) (227) (67) (1,099) Transfers from general funds 174 156 5 335 Balance at 31 December 2015 1,705 160 115 1,980

The Designated funds received grants of £335k (2014: £284k) made by the Society to Member Networks to support activities at that level. Each network has, as its objects, those that are embodied in the Society’s Charter. There is no time frame for usage of the funds. The groups can use the funds as needed for their ongoing activities.

52 24 Royal Society Of Chemistry

Included in the accounts is income of £53,127k (2014: £50,357k) from the Royal Society of Chemistry as a standalone entity and net deficit of £9,296k (2014: £2,242k net income).

 25 Connected charities

Sir George Beilby Memorial Fund 2015 2014 £000 £000 Accumulated fund 59 60 Represented by: Investments 73 74 RSC creditor (14) (14) 59 60

This fund is jointly administered by the Society, the Society of Chemical Industry, and the Institute of Materials. The Society’s share of the above figures are not included in the Statement of financial activities, Society’s balance sheet or consolidated balance sheet on the basis of materiality.

53 26 Transactions with Trustees

Trustees’ royalty payments 2015 2014 £ £ Name of member Prof A Rodger - 54 Total Trustees’ royalty payments - 54

The Trustees’ royalty payments were relating to contributions made to RSC publications. The payments are made in accordance with a formal Memorandum of Agreement.

No Trustees received or waived remuneration during the year (2014: £nil).

Trustees’ expenses An amount of £25,621 was reimbursed to 13 (2014; 15) Trustees in respect of travel to meetings and related expenses in 2015 (2014: £31,722). Travel expenses paid directly to third parties in relation to trustees was £52,632 in 2015 (2014: £28,965).

Donations from Trustees Total donations received without conditions from trustees was £72 in 2015 (2014: £70).

Trustees’ indemnity insurance The amount paid in 2015 for Trustees’ indemnity insurance was £5,476 (2014: £5,000).

Related parties In 2015 the following transactions took place between the Society and its wholly owed subsidiaries:

2015 2014 £ £000

Management fee charged to subsidiaries 14 27 Service payments to subsidiaries (7,919) (3,500) Service charges to subsidiaries 72 - Interest received on loans to subsidiaries 21 109 Loans due from subsidiaries 21 3,960 Gift aid received from subsidiaries 21 - Debtor amounts due from subsidiaries 643 4,822 Creditor amounts due to subsidiaries (28) -

The amounts due from group undertakings previously included a loan to RSC Worldwide Limited by the RSC, which was subject to interest charged at LIBOR plus 2%. The loan balance at 31 December 2014 was £3,960K and was fully repaid in 2015.

54 27 Trust and lecture funds

Fund Balances as at 31 December 2015 2014 Accumulated Opening investment Closing Closing balance Income Expenditure movement balance balance £000 £000 £000 £000 £000 £000 Appleyard Fund 59 2 (2) 1 60 59 Ethel Behrens Fund 35 1 (1) - 35 35 William Briggs Fund 200 7 (4) 3 206 200 Centenary Fund 545 20 (46) 7 526 545 Chemical Council Fund 64 2 (21) 1 46 64 Corday Morgan Medal and Prize Fund 220 8 (18) 3 213 220 Corday Morgan Memorial Fund 793 29 (35) 11 798 793 Faraday Lecture Fund 25 1 (1) - 25 25 Robert John Flintoff Trust 33 1 - - 34 33 Edward Frank Harrison Memorial Trust 30 1 - - 31 30 Haworth Memorial Fund 20 1 - - 21 20 Liversidge Lecture Fund 35 1 - - 36 35 Pedler Lecture Fund 41 1 (2) 1 41 41 Research Fund 1,529 56 (66) 25 1,544 1,529 Robert Robinson Lecture Fund 121 4 (7) 2 120 121 Saville Fund 122 5 (5) 2 124 122 Simonsen Lecture Fund 25 1 (1) - 25 25 Tilden Lecture Fund 182 7 (17) 2 174 182 Ronald Nyholm Lecture Fund 15 1 - - 16 15 Christopher Ingold Lecture Fund 29 1 (2) - 28 29 Spiers Memorial Fund 23 1 (2) - 22 23 Bourke Lecture and Medal Fund 10 - (5) - 5 10 Marlow Medal and Award Fund 82 3 (5) 1 81 82 John Jeyes Lectureship Fund 49 2 - 1 52 49 BOC (Gases Division) Trust 186 7 - 2 195 186 Edward Horton Bequest 67 2 - 1 70 67 Ludwig Mond Trust 100 4 (5) 1 100 100 Industrial Division Endowment Lecture Fund 133 5 (4) 2 136 133 Henderson Memorial Lecture Fund 40 1 - 1 42 40 PF Frankland Memorial Lecture Fund 69 2 (3) 1 69 69 W J Hickinbottom Bequest 1,548 56 (5) 21 1,620 1,548 Whittle Memorial Fund 17 1 - - 18 17 R A Robinson Memorial Fund 185 7 (6) 2 188 185 E Frankland Prize and Lecture Fund 26 1 (3) - 24 26 Barrer Award 30 2 (1) - 31 30 A Spinks Symposia Fund 113 4 - 2 119 113 Rhone–Poulenc Lectureship 25 1 - - 26 25 Marriot Legacy 209 8 (4) 3 216 209 A Robertson Bequest 199 7 - 3 209 199 E Frankland Fellowship 86 3 (3) 1 87 86 W A Waters 229 8 (14) 3 226 229 J O Cutter 764 28 (41) 10 761 764 S F Boys–A Rahman Lecture Fund 25 1 (2) - 24 25 C Sulzbacher 92 3 (4) 1 92 92 A Albert 613 22 (9) 8 634 613 J Chatt Lectureship 58 2 (2) 1 59 58 G Wilkinson Lectureship 77 3 (2) 1 79 77 Colman–Porter Fund 336 12 (12) 4 340 336 Memorial Fund 115 4 (5) 2 116 115

55 27 Trust and lecture funds (continued)

2015 2014 Accumulated Opening investment Closing Closing balance Income Expenditure movement balance balance £000 £000 £000 £000 £000 £000 Bill Carruthers Lectureship 22 1 - - 23 22 Brian Scarlett Memorial Fund 2 - - - 2 2 Lord Lewis Award 13 - (1) - 12 13 Charles Rees Award 102 4 - 1 107 102 Harry Shalgosky Bequest 35 1 (2) - 34 35 9,803 356 (368) 131 9,922 9,803 Represented by: Investments 8,229 8,098 Balance at banks (inc. deposits) 18 25 Funds invested by RSC on behalf of trust funds 1,644 1,611 Accrued income 69 77 9,960 9,811 Less: sundry creditors (14) (3) Accrued expenses (24) (5) Value of funds reflecting investments at market value 9,922 9,803

Further details regarding trust funds with an accumulated balance in excess of £250k are disclosed below. A Albert The fund was founded in 1962 by a bequest from Adrien Albert. The fund gives financial support to lecturers and prizes likely to promote interest in the study of the laws connecting chemical structure with biological activity. Centenary Fund In July 1947 the Chemical Society and subsequently the Royal Society of Chemistry celebrated the centenary of its foundation, which was commemorated by the creation of a capital fund. The fund is administered by the Council of the Society and the interest earned on the capital investment is employed to further the objectives of the Society, such as the promotion of international interchange of new chemical knowledge. Colman–Porter Fund The fund was founded in 1999 following a bequest from Mrs I V Colman–Porter for the purpose of helping needy but able post-graduate chemistry students. The capital is invested and the interest used to provide bursaries to students to allow their attendance at courses peripheral to their research but essential to their understanding of the world of business and current practices in industry. Corday Morgan Memorial Fund The fund was founded in 1940 following a bequest by Sir Gilbert Morgan. The funds are to be applied for the unification of the chemical professions formerly within the British Empire by grants or other awards to the Chemical Council or to any other representative body of British chemists in such a manner as the Chemical Society, subsequently the Royal Society of Chemistry, may in their absolute and uncontrolled discretion determine. J O Cutter The fund was founded in 1987 following a bequest by John Cutter. The income from the bequest is to establish and maintain a scholarship at a university approved by the Royal Society of Chemistry. Hickinbottom Fund The fund was founded in 1979 and incorporates the William Briggs Scholarship. The funds are used to endow a prize for notable contributions to the practices of organic chemistry. Research Fund The fund has been established to promote original research in the science of chemistry. The fund is administered by the Chemical Society and subsequently the Royal Society of Chemistry and is awarded by the Research Fund Committee, which is authorised to make a limited number of awards in any one year.

56 28 Consolidated statement of financial activities for year ended 31 December 2014 Restated Unrestricted funds Restricted funds 2014 Total General Designated funds funds £000 £000 £000 £000 Income and endowments from: Donations and legacies 126 29 82 237 Other trading activities 493 - - 493 Investment income 2,231 15 894 3,140 Charitable activities Membership 3,548 64 - 3,612 Chemistry World 1,072 - - 1,072 Scientific conferences and events 470 855 70 1,395 Education and professional practice 42 - 463 505 Publishing 40,409 - 327 40,736 Advocacy and awareness 900 - - 900 Other income 1 - - 1

Total income and endowments 49,292 963 1,836 52,091

Expenditure on: Raising funds Donations and legacies 434 - 2 436 Other trading activities 445 - - 445 Investment management costs 47 - 24 71 Charitable activities Membership 3,980 - 478 4,458 Chemistry World 2,091 - - 2,091 Scientific conferences and events 3,355 1,231 61 4,647 Education and professional practice 4,813 - 369 5,182 Publishing 33,370 - 328 33,698 Advocacy and awareness 4,806 - - 4,806 Total expenditure 53,341 1,231 1,262 55,834 Gains on investment assets 4,819 - 940 5,759 Net income/(expenditure) 770 (268) 1,514 2,016 Transfer between funds (284) 284 - - Net group income/(expenditure) before other recognised gains and losses 486 16 1,514 2,016 Remeasurement on Defined Benefit Pension scheme (22,677) - - (22,677) Net movement in funds (22,191) 16 1,514 (20,661)

Reconciliation of funds

Fund balances brought forward 73,043 1,952 22,641 97,636 Fund balances carried forward 50,852 1,968 24,155 76,975

In accordance with SORP FRS 102, paragraph 4.2, prior year comparatives are presented for the separate classes of funds.

57 29 Transition to FRS 102 and the Charities SORP FRS 102

The company has adopted FRS 102 and the Charities SORP FRS 102 for the year ended 2015 and has restated the comparative prior year amounts. The impact from the transition is as follows:

Reconciliation of funds Group At 1 Jan 2014 At 31 Dec 2014 £000 £000 Note Changes for FRS 102 adoption: Fund balances (as previously stated) 97,014 77,677 Recognition of derivative financial instruments (i) 738 (754) Holiday pay accrual (ii) (158) (201) Correction of prior period errors: Friends of the RSC, Inc. fund balance (vi) 42 40 Accruals adjustment (vii) - 213 Fund balances (as restated) 97,636 76,975

Society At 1 Jan 2014 At 31 Dec 2014 £000 £000 Note Fund balances (as previously stated) 100,591 81,478 Recognition of derivative financial instruments (i) 738 (754) Holiday pay accrual (ii) (158) (201) Correction of prior period errors: Accruals adjustment (vii) - 213 Fund balances (as restated) 101,171 80,736

Reconciliation of net income or expenditure for the year Group At 31 Dec 2014 £000 Note Changes for FRS 102 adoption: Expenditure for the year (as previously stated) (1,262) Recognition of derivative financial instruments (i) (1,492) Holiday pay accrual (ii) (43) Defined benefit pension scheme–interest cost (iii) (1,157) Investment gains (iv) 5,759 Correction of prior period errors: Friends of the RSC, Inc., loss for the year (vi) (2) Accruals adjustment (vii) 213 Income for the year (as restated) 2,016

Society At 31 Dec 2014 £000 Note Expenditure for the year (as previously stated) (1,038) Recognition of derivative financial instruments (i) (1,492) Holiday pay accrual (ii) (43) Defined benefit pension scheme–interest cost (iii) (1,157) Investment gains (iv) 5,759 Correction of prior period errors: Accruals adjustment (vii) 213 Income for the year (as restated) 2,242

58 (i) Foreign exchange forward contracts are now (vi) Friends of the RSC, Inc. is registered in the U.S. and is recognised at fair value at the end of the year with not a wholly owned subsidiary of the RSC but the Society changes in fair value recognised in profit or loss. is deemed to have significant control of the entity and as Previously foreign exchange contracts were not such the company has been included in the consolidated recognised in the statement of financial position. financial statements for 2015. As a result the prior year Consequently financial assets of £738k have been comparatives have been adjusted to include the fund recognised in the opening balance sheet at 1 January balances of the entity and its operating loss in 2014. 2014. Financial liabilities of £754k have been recognised (vii) Following a review of transactions in the year, £213k in the balance sheet as at 31 December 2014. The effect of accruals were identified, which should have been for the year ended 31 December 2014 is to increase released in 2014. Although the amount is immaterial to the deficit by £1.5m. This has been offset against the financial statements as a whole, the adjustment has the previously recognised foreign exchange gains in been put through the accounts as 2014 is being restated incoming resources and the net loss is recognised in for the FRS 102 transition. expenditure. Other adjustments arising on transition to FRS 102 (ii) Under pevious UK GAAP, there was no accrual for In addition to the transition adjustments identified holiday pay that was earned but the holiday entitlement above, which affect the loss for the financial year, the was expected to be taken in the subsequent financial following adjustments have arisen, which have had no year. Under FRS 102, an accrual is required for all short- effect on funds or the SoFA, but which have affected the term compensated absences as holiday entitlement presentation of these items on the balance sheet. The earned but not taken at the date of the balance sheet. main items are: Consequently an additional accrual of £158k at 1 January 2014 has been made to reflect this. The additional Website development costs, with a net book value of provision at 31 December 2014 is £201k and the effect £1,331k at 1 January 2014, have been reclassified from on the loss for the year ended 31 December 2014 is an tangible to intangible assets as required under FRS 102. additional expense of £43k. This has no effect on the Group’s net assets nor on the surplus for the year, except that the previous depreciation (iii) Under previous UK GAAP the Group recognised an charge is now described as amortisation. The amount expected return on defined benefit plan assets in the reclassified at 31 December 2014 was £1,452k. SoFA. Under FRS 102 a net interest expense, based on the net defined benefit liability, is recognised in the SoFA. Restricted grant income (shown in Note 22), with a There has been no change in the defined benefit liability carrying value in restricted funds of £2,700k as at 31 at either 1 January 2014 or 31 December 2014. The effect December 2013, has been reviewed and £2,387k of of the change has been to reduce the credit to the SoFA historic income has been identified as unrestricted in the year to 31 December 2014 by £1,157k and increase and transferred to general funds. During this review, the credit in other recognised gains and losses by an an additional £40k of restricted income and £177k of equivalent amount. restricted expenditure were identified in 2014 and the SoFA has been restated accordingly. (iv) Under the new 2015 SORP investment gains and losses, whether realised or unrealised, are combined and shown in the SoFA before net income/expenditure rather than after.

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